A series of questions in which our writer attempts to answer simple-sounding questions without saying things like "Well, yes, they do have ELT but..." Let the reader understand that these are simplified answers. ;)
See the other posts in this short series: Electronic Title States, Upcoming Electronic Title States, States Compelling Participation in ELT (this post), and States Planning to Compel Participation in ELT.
Which states compel participation in their ELT program?
This is one of the most complicated questions to answer, and the wording for the question was chosen carefully to accurately include all the states above. We intentionally did not phrase the question "What are the Mandatory ELT states?" or even "Which states never print titles with liens?"
There are four basic methods that States are currently using to "compel" participation:
- Mandatory ELT: by law lenders must participate in the program. This applies to PA, LA, CA, and AZ. Each state allows for certain exemptions, particularly for individuals listed as lienholders. Arizona required immediate participation and would not process lien applications without enrolling in the program. Pennsylvania (the first state to make ELT mandatory) used a gradual enforcement process. Louisiana, while always maintaining that ELT participation is required, is also gradually enforcing their law. California's law went into place in 1/1/2012 but the law allowed them to determine schedule and exemptions. At this point we are expecting them to implement the ELT participation mandate in September 2012 as Arizona did, requiring participation to even file a lien.
- Phase out the paper title: Florida is the author and authority of this method which basically involves changing policies to make vehicle transactions easier without a paper title - the paper title just becomes obsolete. Florida is not on our list above because they do not require participation in ELT nor do they restrict the printing of paper titles. They do intend to require participation in the near future.
- Fees for non-electronic processing: Wisconsin charges lenders fees for not participating. There is always an extra $5 processing fee for manual transactions. In addition, "if a financial institution is not exempt, it will be assessed a $20 surcharge for each application submitted to DMV for processing that can be completed electronically...."
- No paper titles with liens: Nebraska and Kansas both leave it to the lender's preference about participating in their ELT programs, but do not print and mail titles with liens as part of their normal process.
If you are a lender and would like a greater explanation of these differences, please contact DDI. If you are a state or would like more technical details, you may also visit our AllAboutTitles.com site.