| Perfection
|| Possession and Sale || New Title
and Plates || Other Issues
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| LAWDOG™ Maryland Repossession |
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| Validity and Perfection of Security
Interests Unless excepted by § 13-201 of this subtitle, a security
interest in a vehicle is not valid against any creditor of the owner or any subsequent
transferee or secured party unless the security interest is perfected as provided in this
subtitle. A security interest is perfected by delivery to the Administration of every
existing certificate of title of vehicle and an application for certificate of title on
the form and containing the information about the security interest that the
Administration requires; and payment of a filing fee established by the Administration,
which is in addition to any other fees that apply under the Maryland Vehicle Law. See
Maryland Statutes Section 13-202 |
| When Perfected The security
interest is perfected at the time of its creation, if the delivery and payment to the
Administration are completed within 10 days of the date of its creation. Otherwise, the
security interest is perfected at the time of the delivery and payment. See Maryland
Statutes Section 13-202 |
| Out of State
Vehicles If a vehicle already is subject to a security interest when brought into
this State, the validity of that security interest in this State is determined by the law
(including the conflict of law rules) of the jurisdiction where the vehicle was located
when the security interest attached, subject to the rules included in section See
Maryland Statutes Section 13-202 |
Duties of Owner Creating Vehicle Security
Interest
Signed Certificate To Administration The owner must immediately execute
the application in space provided on certificate of title or on approved separate form,
naming the secured party on certificate of title and showing name and address of secured
party, amount of security interest, and date of security agreement. The certificate of
title and application must immediately be delivered to the Administration, along with
required filing fee. See Maryland Statutes Section 13-203 |
| 10 Day Filing Grace Period To Date Back
The security interest is perfected at the time of its creation, if the delivery and
payment to the Administration are completed within 10 days of the date of its creation.
Otherwise, the security interest is perfected at the time of the delivery and payment. See
Maryland Statutes Section 13-203 |
| New Certificate Reflects Lien
On receipt of the certificate of title, application, and required filing fee, the
Administration either endorses the existing certificate of title or issues a new
certificate with name and address of each secured party, and delivers the endorsed
certificate of title to the owner named on it. See Maryland Statutes Section 13-203 |
| Exclusive Motor Vehicle Procedure
The method provided in this subtitle of perfecting and giving notice of security interests
is exclusive. 13-207 |
| Maryland Statutes from the Maryland General
Assembly, Office of Information Systems |
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| Possession After Default Without Breach of
Peace Unless otherwise agreed, a secured party has on default the right to
take possession of the collateral. In taking possession a secured party may proceed
without judicial process, only if this can be done without breach of the peace. If not, a
legal action may proceed. See Maryland Uniform Commercial Code Section 9-503 |
| Right to Redeem At
any time before secured party has disposed of collateral or entered into a contract
for its disposition under section 9-504 or before discharge under section 9-505, debtor or
any other secured party may, unless otherwise agreed in writing after default, redeem the
collateral by tendering fulfillment of all obligations secured by the collateral, expenses
reasonably incurred by secured party in retaking, holding and preparing the collateral for
disposition, arranging for sale, and to extent provided in agreement and not prohibited by
law, his reasonable attorneys' fees and legal expenses. See Maryland Uniform Commercial
Code Section 9-506
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| Compulsory Sale If the
debtor has paid 60% of the cash price in case of a purchase money security interest in
consumer goods or 60% of the loan in case of another security interest in consumer goods,
and has not signed after default a statement renouncing or modifying rights under this
part, a secured party who has taken possession of collateral must dispose of it under
section 9-504 and, if he fails to do so within 90 days after he takes possession, debtor
at his option may recover in conversion or under section 9-507, on
secured party's liability. See Maryland Uniform Commercial Code Section 9-505 |
| Acceptance As Satisfaction
In any other case involving consumer goods or any other collateral, a secured party in
possession may, after default, propose to retain the collateral in satisfaction of the
obligation. Written notice of such proposal shall be sent to the debtor if he has not
signed, after default, a statement renouncing or modifying his rights under this
subsection. In the case of consumer goods, no other notice need be given. In other cases,
notice must be sent to any other secured party from whom the secured party has received,
before sending notice to debtor or before renunciation of rights, written notice of a
claim of interest in the collateral. If secured party receives objection in writing from a
person entitled to receive notice within 21 days after the notice was sent, secured party
must dispose of the collateral under section 9-504. In the absence of such written
objection, secured party may retain the collateral in satisfaction of the obligation. See
Maryland Uniform Commercial Code Section 9-505 |
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| Sale and Application of Proceeds A
secured party after default may sell, lease or otherwise dispose of any or all of the
collateral in its then condition or following any commercially reasonable preparation or
processing. The proceeds of sale must be applied in the order following to reasonable
expenses of retaking, holding, preparing for sale or lease, selling, leasing and the like,
and, to extent provided for in agreement and not prohibited by law, reasonable attorneys'
fees and legal expenses incurred by secured party. Funds are then applied to satisfaction
of debt secured by the security interest under which the sale is being made. |
| Subordinate Liens If any
proceeds remain, they would then be applied to satisfaction of debt secured by any
subordinate security interest in the collateral if written notice of demand is received
before distribution of proceeds is completed. If requested by secured party, holder of a
subordinate security interest must seasonably furnish reasonable proof of interest, and
unless he does so, secured party need not comply with demand. See Maryland Uniform
Commercial Code Section 9-504 |
| Accounting and Deficiency If
the security interest secures debt, secured party must account to debtor for any surplus,
and, unless otherwise agreed, debtor is liable for any deficiency. |
| Public or Private Sale, in a Commercially
Reasonable Manner, after Notice Disposition of the collateral may be by
public or private sale, and at any time and place and on any terms, but every aspect of
disposition including method, manner, time, place and terms must be commercially
reasonable. See Maryland Uniform Commercial Code Section 9-504 |
| Reasonable Notice Unless
collateral is perishable or threatens to decline speedily in value or is of a type
customarily sold on a recognized market, reasonable notification of the time and place of
any public sale or reasonable notification of the time after which any private sale or
other intended disposition is to be made shall be sent by secured party to debtor. |
| Notice To Subordinates In
cases other than consumer goods notice must also be sent to any other secured party from
whom secured party has received, before notice to debtor or before renunciation of rights,
written notice of claim of interest in the collateral. The secured party may buy at any
public sale and if the collateral is of a type customarily sold in a recognized market, or
is of a type which is subject of widely distributed standard price quotations, he may buy
at private sale. See Maryland Uniform Commercial Code Section 9-504 |
| Good faith Purchaser Generally Gets Good
Title When collateral is disposed of by a secured party after default, the
disposition transfers to a purchaser for value all of the debtor's rights therein,
discharges the security interest under which it is made and any security interest or lien
subordinate thereto. The purchaser generally takes free of all such rights and interests
even though the secured party fails to comply with the requirements if the purchaser acts
in good faith. See Maryland Uniform Commercial Code Section 9-504 |
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| Involuntary Transfer
Except as otherwise provided in this section, if the interest of an owner in a vehicle for
which a certificate of title has been issued passes to another person other than by
voluntary transfer, the transferee shall present to the Administration the last
certificate of title for vehicle, if available, and apply for a new certificate of title.
See Maryland Statutes Section 13-114 |
| Appropriate Documentation Required The
application for a new certificate of title under this section must be accompanied by such
instruments or documents of authority or certified copies of them as are sufficient in law
or required by law to evidence or effect a transfer of title or interest in or to chattels
in such case. A written assignment of title or interest is not required if prior owner's
title or interest has passed to transferee as a result of a judicial decree, order, or
proceeding.See Maryland Statutes Section 13-114 |
| Application After Repossession
The Administration may transfer on its records the ownership of a vehicle that has been
repossessed by a secured party, if the secured party submits to the Administration a
certification that states that the secured party has a security interest in the vehicle,
and that, on the basis of the security agreement or other lawful basis, secured party has
a right to possession of and title to vehicle, and, in fact, has possession of vehicle.
The secured party must furnish any other information required by the Administration. On
submission of proper certification, the Administration may issue a new certificate of
title when satisfied that secured party is entitled to one. See Maryland Statutes Section
13-114 |
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| Delivery of New Certificate
Except as otherwise provided in this subtitle, when the Administration issues a
certificate of title of a vehicle, it must deliver the certificate of title by mailing it
to the owner of the vehicle. However, where a vehicle has been repossessed by a lessor,
lender, or credit grantor, the lessor, lender, or credit grantor or a title service agent
on behalf of the lessor, lender, or credit grantor may request delivery by hand at a
facility of the Administration of the certificate of title of the repossessed vehicle or a
duplicate of the certificate of title. See Maryland Statutes Section 13-108 |
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