Indiana sells liens to repossessed vehicles at auction. Investors bid on the liens and the highest bidder purchases the lien. However, the sale does not become final until the original owner of the vehicle surrenders the vehicle or one year has passed. You must get a tax deed in addition to a lien before you can take possession of the vehicle.
Provide Lienholder Information
If you have a lien outstanding on your vehicle, you cannot sell it without the lienholder's permission. When you go to the Indiana Department of Motor Vehicles to transfer the title, you must provide the lienholder's contact information. The DMV then contacts the lienholder to get a copy of the title and transfer it into the buyer's name. The lienholder can refuse to release the title if you have not made arrangements to transfer the lien.
No Automatic Release
Indiana does not automatically release liens when you pay them off. If there is a lien on your vehicle for past due auto tax or anything else, after you pay it off, you must apply for a new title in your name alone. Most lienholders take care of this for you -- once you pay back the loan, the lienholder contacts the DMV and files an application to get a new title in your name.
Auctions
If you purchase an auto tax lien at an auction, you must pay the property taxes due on the auto that year. Indiana requires you to pay property taxes regardless of whether the original owner of the vehicle paid taxes before the lien was sold at auction. Pay property taxes to your county of residence when you purchase the lien.
Right of Redemption
Indiana gives the original owner of a vehicle one year to redeem the vehicle after if it is sold at auction. Thus, purchasing the lien does not guarantee you the right to possess the vehicle; you may not possess it until you get a tax deed from the register of deeds in your county. If a vehicle owner redeems a vehicle, meaning he repays what he owes on it, the lien buyer has the right to reimbursement of his purchase price as well as any attorney's fees associated with the lien.
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