Now that the ELT program is mandatory in Louisiana (as of January 1, 2010) all lenders are required to participate. There are fees related to participating, so how does a lender deal with this increased cost of filing liens?
Option 1: Increase the application fee
This is probably the least attractive option to most lenders. Lenders are often reluctant to increase their fees or are unable to do so for a variety of reasons. For lenders who work with dealers to process their paperwork, they may not receive a fee from their customer at all.
Option 2: Pass the fee to the customer
It may be possible in Louisiana to collect the fee for electronic liens and title processing from the customer. Normally, "convenience" fees cannot be collected directly from the customer, but because the ELT program is mandatory in LA, ELT fees could be considered as separate from the "convenience" fee designation. Contact your legal counsel and reference LA RS 6:969.18.
Option 3: Absorb the cost
Several of our current customers see the ELT fee as a part of their cost in managing and tracking titles. Our cost benefit calculator considers all costs related to managing titles and calculates based on the differences between a paper-title program and an ELT program. (Differences such as looking up title/owner and matching to current open loan applications, scanning and filing paper titles, and having to request duplicates for owners who lost the title you provided.)
Bottom line: Keep the cost of ELT low
The best bet for you and your customer is to keep your ELT costs to a minimum. Premier eTitleLien™ has no monthly minimums, no support costs, no start-up fees, and no support fees. We charge a single fee on a transaction-by-transaction basis. Contact us for more information.
Image: Jennefer Asperheim's Dice: "Who Pays"
