What is a bonded title.The bonded titling process consists of a series of situations surrounding an ownership titling event, most commonly for a motor vehicle, in which some part of the documentation required for ownership is missing or unavailable and the previous owner(s) cannot be located in order to obtain the required documentation. If you do not have acceptable evidence of ownership for your vehicle, you have the option of applying for a bonded title.

How Do I Qualify for a Bonded Title?

In order to qualify, you must be a Texas resident or military personnel stationed in Texas; or have a vehicle that was last titled in Texas. The vehicle must be in your possession and cannot be considered abandoned, junked, stolen, or in any other pending lawsuits. Although not required to be operational, it must be a complete vehicle including a frame, body and motor or frame and motor if a motorcycle.

The term "Bonded Title" is commonly used when an individual or firm has obtained a Certificate of Title Surety Bond in order to register a motor vehicle. It is also referred to commonly as a Texas Bonded Vehicle Title.

What Is a Bonded Title - Basic Facts:
The Transportation Code §501.053 allows for a bond in the amount of one and one-half times the value of the vehicle. It is effective for a period of three years and this accompanies the documents presented to the County Tax Assessor-Collector to be filed with the Texas Department of Transportation (TxDOT) to obtain a motor vehicle title when the previous owner of the motor vehicle does not have possession of the original title.

How Do I Obtain a Bonded Title?

Step 1: Determine your eligibility

In order to qualify, you must be a Texas resident or military personnel stationed in Texas; or have a vehicle that was last titled in Texas. The vehicle must be in your possession and cannot be considered abandoned, junked, stolen, or in any other pending lawsuits. Although not required to be operational, it must be a complete vehicle including a frame, body and motor or frame and motor if a motorcycle. To determine your eligibility for the bonded title procedure and the value of the bond, take or mail the following documents to your Vehicle Titles and Registration (VTR) Division Regional Office:

• A Statement of Fact for Bonded Title (VTR-130-SOF),
• A Statement of Physical Inspection (VTR-270)
• Any supporting evidence of ownership (Bill of Sale, Invoice, Cancelled Check, etc.)
• A photocopy of your driver’s license if requesting Texas motor vehicle information

If your documents are approved, the amount of the bond equal to 1½ times the value of the vehicle will be determined by the Regional Office using a national reference guide. If you disagree with the amount you may furnish an appraisal by a licensed motor vehicle dealer or insurance appraiser. Once the value of the vehicle is determined the VTR Regional Office will give you a letter within 24 hours showing the amount the bond needs to be purchased in.

Step 2: Purchase a surety bond

Take the letter and other documents given to you by the VTR Regional Office to an auto insurance agency or any agency that sells vehicle Surety Bonds. You have one year from the date of the letter to purchase a Surety Bond in the amount shown on the letter, otherwise a new letter and bond would be required.

Step 3: Apply for a bonded title

Within 30 days from purchasing the surety bond, take the original letter given to you by the Regional Office and the documents listed above, to your county tax office, in addition to:

• a completed Form VTR 130-U
• proof of insurance.

If the vehicle is from out of state, you will also need to provide a Vehicle Identification Certificate (Form VI-30), completed by a Safety Inspection Station. If the vehicle is from out of country, you will need a Customs Document (HS 7). If the vehicle is a truck or commercial vehicle you may also need a weight certificate.

Buyer Beware

Although there are valid reasons why a title may not be readily available, you are encouraged to use caution and review the above material if you are considering purchasing a vehicle to which the owner is not in possession of the title at the time you are negotiating the purchase.