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California Defective Title / Motor Vehicle Ownership Bonds

What is a California Defective Title / Motor Vehicle Ownership Bond?

A California title bond (a surety bond) is a type of insurance you're required to purchase as proof you're the new - legal - owner of a vehicle.

The title bond backs the bonded title you'll receive from the California Department of Motor Vehicles. The bonded title is your proof of ownership for the next 3 years until you can replace it with a standard title.

Get Your California Defective Title Bond

Vehicle Title Bond
$10,000 or Less

Bonds up to $10,000

3-Year Bond

Vehicle Title Bond
$10,001 to $50,000

Bonds over $10,000 up to $50,000

3-Year Bond Starts at $100.00
1.0%-1.5% of the Bond Amount

Vehicle Title Bond for Mobile home, Commercial Coach, or Truck Camper

3-Year Bond

Vehicle Title Bond
over $50,000

Bonds over $50,000

3-Year Bond

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Who Is Required to Purchase a California Title Bond?

You're required to purchase a bonded title if:

  • The original title does not have the seller's name and your name on the back
  • The original title is damaged or illegible
  • The original title is missing

In California a title bond is required when evidence of ownership is not available and at least one of the following is true:

  • Value of vehicle is $5,000 or more
  • Value of vessel is $2,000 or more
  • Vehicle is nontransferable (goldenrod registration)
  • A release from the legal owner or lienholder cannot be obtained

Diligent Effort Process:

If the vehicle requires a title bond, you must submit a certified letter showing you went through a diligent effort process. This includes:

  • Showing what effort was made to contact the last owner or owners to obtain evident of ownership
  • Document why this was not obtainable if you could not get evident of ownership
  • How and when you acquired the vehicle or vessel
  • Make sure their are no additional liens on the vehicle separate from those listed on the application
  • The current value of the vehicle and how it was determined
  • Form REG 256 if you ended up having the vehicle appraised

The details of these steps are below.

Why is a California Defective Title Bond Required?

The title bond is a surety bond that backs the bonded title issued by the California Department of Motor Vehicles.

A bonded title is required as protection for:

  • A previous owner who still legally owns the vehicle
  • Any third party who has a lien against the vehicle

Again, California is unique. Most states won't issue a title bond if there are liens on the vehicle. In California, having liens on the vehicle is one of the potential requirements requiring you to purchase a title bond.

It's vital you conduct your due diligence when you purchase a used vehicle.

The 3 Steps To Get a Bonded Title in California

Step 1: Determine the Value of Your Vehicle

There are two options for getting the fair market value of your vehicle.

1. Written Appraisal

You can obtain a written appraisal provided by a:

  • Licensed dealer in California or another state
  • Motor vehicle insurance representative
  • Yacht or shipbroker in the case of a vessel

There is no official form for this appraisal but it must come from the licensed dealer or insurance representative.

You typically will have to get an appraisal when the value of your vehicle cannot be found using the second option below.

2. An Industry Recognized Motor Vehicle Valuation or Pricing Handbook

An industry recognized motor vehicle valuation or pricing handbook is a fancy way of saying:

These websites typically give you three values after you answer their proprietary questions about your vehicle.

The middle value should be the average, but California states on their website to take the average of the high value and the lower value. It's good to calculate this average to be on the safe side.

Take the high value and add the low value, then divide by two.

However you come to the value of your vehicle, this is also the value of the title bond you need to purchase.

Step 2: Purchase The Title Bond

At Surety Bonds Direct, we work with the highest A-rated sureties to find you the lowest possible price on your California title bond.

Click here go back to the top of the page and purchase your title bond based on the value from step 1.

Step 3: Get Your Vehicle Registered

Once you receive your title bond you can register your vehicle with the California Department of Motor Vehicles.

Show proof of liability insurance and California will issue you a bonded title that must remain active for 3 years.

Remember, a bonded title is a vehicle title backed by the surety bond you purchased. This title will have “bonded” printed on it.

It's important to understand, a title bond has nothing to do with the insurance you purchase to protect you from accident and bodily injury.

How Much Does a California Title Bond Cost?

The cost of a title bond is based on the fair market value of your vehicle as determined by:

  • A written appraisal provided by a licensed vehicle dealer or insurance representative
  • Getting the value from a website such as Kelly Blue Book or the National Automotive Dealers Association

Once you have the correct bond amount, use our pricing cards above to get your bond price.

Keep in mind, if the value of the bond is more than $25,000, you will require a custom price. This custom price is determined by a surety, the insurance company that underwrites surety bonds.

The surety will take into account your personal credit for these larger bond amounts.

This is why it's so important to work with Surety Bonds Direct.

Even if you have poor credit, we're able to shop around and find a surety that is willing to underwrite the lowest cost bond possible.

Plus, we have a lot of experience working with individuals who have less than perfect credit.

Let us help you find the lowest price so you can get your vehicle registered and titled.

How Long Does a Bonded Title in California Last?

In California the bonded title remains active for 3 years.

This period of time allows for any rightful owner or lienholder to come forth and make a claim for the vehicle.

After 3 years, the California Department of Motor Vehicles will issue you a normal title. The underlying surety bond will expire.

At this point the vehicle is officially yours and any claims for the vehicle are rendered invalid.

Watch our video explaining how to get a bonded title in California.