Pennsylvania Mulls Eliminating Registration Stickers

A recent article on CBS Philly entitled "Pennsylvania Mulls Eliminating Registration Stickers" adds an interesting perspective to the trend to make vehicle documentation services (titles and registration) electronic.

PennDOT is working with the state legislature and law enforcement to eliminate the need for physical registration stickers on PA license plates. This would cut down on mailing and printing costs for the state. The last line of the article makes the key point:

[Pennsylvania Transportation Secretary Barry Schoch] says if PennDOT doesn't have to mail out stickers, motorists would be able to renew registrations entirely online.

Electronic services such as Electronic Lien and Title (ELT) programs and online (paperless) vehicle registration improve efficiencies for the state, lenders, dealers, and vehicle owners. For more details on Pennsylvania's ELT program, visit PAELT.com.

Image above is The Pennsylvania Historical and Museum Commission License Plate.

States Compelling Participation in ELT

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?

• Arizona
• California
• Kansas
• Louisiana
• Nebraska
• Pennsylvania
• Wisconsin

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.

Image above is titled "Constitution and Playing Rules of the National League of Professional Base Ball Clubs. Official 1876.".

Electronic Title States

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 (this post), Upcoming Electronic Title States, States Compelling Participation in ELT, and States Planning to Compel Participation in ELT.

Which states currently have an Electronic Lien and Title (ELT) program?

• Arizona
• California
• Florida
• Georgia
• Hawaii
• Idaho
• Kansas
• Louisiana
• Massachusetts
• Nebraska
• New York
• Ohio
• Pennsylvania
• South Carolina
• Texas
• Utah
• Virginia
• Washington
• Wisconsin

Please note the following:

• The Kansas Electronic Lien and Title program does not currently accommodate direct interaction with service providers like DDI.
• In New York, the program is known as the Electronic Lien Transfer (ELT) Program, since there is no electronic title. Even with liens, owners retain titles in New York state.
• The Utah E-Liens (Electronic Lien Transfers) program does not currently accommodate direct interaction with service providers like DDI.
• The Wisconsin program does not currently meet our definition for a full ELT program, since as in New York, owners retain the paper title and the state does not electronically notify lenders when the lien has been recorded. However, they do require lenders to participate in their lien recording program, e-MV Agent. Wisconsin DOT expects to change to a full ELT program in the Summer of 2012. ("On July 1, 2012, Wisconsin will become an electronic title state.")

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.

Image above is United States Map Bookshelf.

Pennsylvania ELT Updates

I've just updated our PAElt.com site, refreshing the wording on the first page and adding some additional Frequently Asked Questions. A few examples:

Who is required to participate?
From the PA ELT Fact Sheet:
All Lienholders in the business of financing vehicles are required to participate in the ELT Program and must be under contract with a PennDOT-approved ELT service provider.

How do I sign up for the ELT program?
You need to complete a form MV-37 "Application for Enrollment/Change in Electronic Lien and Title System". PennDOT does not require a contract or agreement (as most other ELT states do). They do however require that you work with a "Service Provider" from the list of those on the form. DDI is a service provider for Pennsylvania. Use the link [here] to get a copy of our application and an MV-37. PA estimates 2 weeks from receipt to issuing an ELT account number (FIN number) but our experience has been that they issue an account number within a few days. A start date should be requested on the MV-37.

How do I switch service providers?
In Pennsylvania, the same form (MV-37) is used to switch providers as to sign up initially. Just indicate on the form a change of providers rather than initial enrollment. Pre-filled forms are available at eTitleLien.com.

Image above is Hot Wheels by Morning Toast.

Signing up to be in Pennsylvania ELT

The Pennsylvania Department of Transportation (PennDOT) is requiring anyone wishing to apply for a lien on a vehicle title in Pennsylvania to participate in the Electronic Liens and Titles (ELT) program. Since their program became mandatory (as of July 10, 2008) they have been requiring all lenders (those normally engaged in the business of lending money for automobiles or other titled vehicles) to have an FIN (Financial Institution Number).

The FIN is assigned by PennDOT and must be included on any title application (like the MV-38L). This number is not identical to the IRS assigned FEIN.

Pennsylvania is one of the easiest states to apply to participate in ELT. They do not require a contract or "memorandum or understanding". Just complete their short MV-37 and select a service provider from the list.

My company (Decision Dynamics, Inc.) is (of course) one of the service providers available. For more information about applying with us, please visit http://www.etitlelien.com/ELT.aspx.

Image: Philadelphia skyline from I-95

Pennsylvania: You must use ELT

At DDI we are pleased to be working with a great program like ELT. I've worked with projects (and products) that I was less-than-excited about but ELT is not like that. The program really does benefit everyone involved (lenders, vehicle owners, and states).

So if you are a state like Pennsylvania and you've got this great program (ELT) but participation is low - what options do you have? You can work on your processes to make participating easy, low-cost, and beneficial. Florida has worked to reduce the need for a paper title when transferring ownership or applying for a lien. Wisconsin has a free online program lenders can participate in.

Or you can require it. Pennsylvania is the trailblazing state taking this route. If you are in the regular business of providing auto loans, in state or out, you are required to use ELT when applying for a lien and removing a lien from a title.

They are not the only state taking this approach. Both Louisiana (by January 1, 2010) and California (by January 1, 2012) have passed legislation making participation mandatory. Arizona's mandatory legislation (by May 31, 2010) has resulted in the department revising their processes to make participation easier.

While we'd love to see all states work on simplifying the lien process, ELT programs are beneficial to everyone.