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Feeling Abandoned? Dealing With Cars That Renters Leave Behind On Your Property

Your tenant leaves a car on the premises after being evicted. If you are like me, you may think you can recover some of the unpaid rent by selling the car. Unfortunately I recently learned it is not an easy process. Obtaining title on a vehicle that was abandoned on your property is somewhat complicated if you are not sure who the registered owner is. (And even if you know the name and address of the registered owner, be ready to be patient and fill out a lot of forms.)

As of July 1, 1996, New Mexico came under a "cloak of confidentiality" as required by Federal mandate [Editor's Note: this is part of the provisions of the Federal Driver's Privacy Protection Act]. Consequently the Motor Vehicle Division (MVD) cannot provide registered owners names and addresses to the public. If you, as the lien claimant, cannot obtain the registered owner's name and address, then the lien process cannot be completed and you cannot obtain title to the car.

I Don't Know Who Owns The Car. Now What?
In this case your best bet is to call a towing company. If you are patient, some local companies will tow the car away for free, schedule permitting. Otherwise you can pay a nominal fee ($45 in my case) to have the car removed. What do these towing companies then do with the vehicle? As a licensed dismantler, they are able to obtain records from MVD showing the owners name and address based on the car's VIN. They notify the registered owner, and hold the car for 44 days for the owner to claim. Thereafter they obtain title to the car and sell it for storage fees owed,  anywhere from $8 to 15 per day depending on vehicle size and storage location (indoors or outside). According to a representative from Discount Towing, "a lot of the cars are crushed because they are basically junk".

Ideally you know the name of the registered owner, and have a good mailing address. If so, you as landlord and claimant may claim a landlord's lien when the owner fails to pay rent or utilities or other services within a reasonable period of time. You also may claim an abandoned vehicle lien on a vehicle that was abandoned on your property for 30 days or more.

How to File A Lien Claim

In order to claim your lien, you as lien claimant must submit the following documents to the MVD:

• Notarized affidavit stating you own or operate a rental dwelling

• NCIC Clearance, which is a statement from the State Police stating the vehicle is not stolen.

• Copies of each Form 10058, Notice of Lien, sent via certified mail or registered return receipt requested mail to the registered owner and all parties involved advising them of the amount due for services and allowing them ten days to pay the amount.

If no payment is made after 10 days of notification, you can advertise the vehicle for public sale by posting handbills for 6 weeks or advertising in a newspaper for 2 weeks, stating that the vehicle will be sold at public auction, the amount due, date, time, and location of the sale. The auction has to be at least 44 days after the registered mail was received, 34 days after the last advertisement, 34 days after the handbills are posted for cars licensed in NM, or 70 days for cars licensed in other states.

Once the required time has passed, you must sell the vehicle at a public auction on the date and at the place advertised. If someone successfully bids for the vehicle, you complete the Affadavit of Resale, form 10059, and the purchaser applies for title and pays the related title and registration fees.

If no one bids or bids are unacceptable, you apply for title and pay the related title and registration fees. Once you obtain a title in your name and wait 30 days after the auction, you may now sell the vehicle.

Sounds complicated, right?
It was too daunting for me, given my unprofessional assessment of value of the vehicle (not much). The bad news, you are still out the rent money. ). The good news is that for a nominal fee very helpful and courteous companies are willing to tow the vehicle away promptly.

Additional Resources

Go to http://www.state.nm.us/tax/forms/mvd/Mvd11070.pdf  for a complete discussion of the special title procedures for the landlord's abandoned vehicle lien process.

Editor's Note: This article pertains to New Mexico law, but the following links from http://www.wikipedia.org/  will give you information from your state's Department of Motor Vehicles.

The phrase "DMV" is most commonly used to describe the driving agency; however, diverse titles are used in different states:

About the Author
Annette West, CCIM, MBA, CPA, is a Las Cruces Commercial REALTOR® and can be reached at AWest@AnnetteWest.com, http://www.annettewest.com/ or at 505-644-1634. She is a contributing writer for Landlord2Landlord.

As always, information in this article is not intended to be used, and should not be used, as legal, tax or accounting advice. Investors should seek advice from an independent financial advisor about their specific situation.