Detailed Answer
When an estate administrator pays off a vehicle loan in Tennessee, they must take clear steps to confirm full satisfaction and clear the lien from the title. Below is a step-by-step process under Tennessee law:
- Obtain a Payoff Statement
Request a written “payoff statement” from the lender. This document lists the exact amount needed to extinguish the loan as of a specific date. Verify the date and amount carefully. - Make the Final Payment
Submit the payment by certified funds (e.g., cashier’s check or wire transfer). Keep proof of payment, such as a bank record or lender acknowledgment. - Request a Lien Release Letter
Once the lender processes the payment, ask for a lien release letter or “satisfaction of lien” document. Under Tennessee law, the lender must issue this within 30 days. See T.C.A. § 55-3-113. - Verify Title Records
Submit the lien release letter and current title to the Tennessee Department of Revenue or your county clerk’s office. They will issue a clear title showing no liens. You can also request a certified status report from the Department’s title division to verify lien removal. - Check UCC Filings (if applicable)
If the lender filed a UCC-1 financing statement with the Tennessee Secretary of State, ask for a UCC-3 termination statement. Under the Uniform Commercial Code (T.C.A. § 47-9-513), the lender must file this to terminate the security interest. - Confirm in Writing
Keep copies of all documents: payoff statement, payment proof, lien release, new title, and UCC-3 termination. This creates a complete record proving the loan is satisfied.
By following these steps and leveraging Tennessee statutes, an administrator can confidently verify that the vehicle loan is fully paid and the lien is removed.
Helpful Hints
- Always request a payoff statement with an expiration date to avoid payoff shortfalls.
- Use trackable payment methods and retain receipts.
- If the lender delays lien release, send a written demand referencing T.C.A. § 55-3-113.
- Confirm lien status online via the Tennessee Department of Revenue before title transfer.
- Keep originals and certified copies of all documents in the estate file.
Disclaimer: This article provides general information on Tennessee law and does not constitute legal advice. Consult a licensed attorney for advice on your specific situation.