Salvage and Nonrepairable Vehicles Obtained by Licensed Vehicle Storage Facilities

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Hurricane Harvey and its aftermath have caused significant impacts to the motor vehicle industry, including licensed vehicle storage facility (VSF) operations.  The department recognizes the VSF industry has an important role in helping Texas recover from this devastating event.  During motor vehicle recovery efforts, we would like to remind you of the statutory requirements for salvage and nonrepairable motor vehicles that you take into your possession that are not claimed by their owner or lienholder.

Texas Transportation Code, Section 501.091, defines a salvage motor vehicle as “a motor vehicle that has damage to or is missing a major component part to the extent that the cost of repairs, including parts and labor other than the cost of materials and labor for repainting the motor vehicle and excluding sales tax on the total cost of repairs, exceeds the actual cash value of the motor vehicle immediately before the damage.”  Further, a nonrepairable motor vehicle is defined as “a motor vehicle that is damaged, wrecked, or burned to the extent that the only residual value of the vehicle is as a source of parts or scrap metal.”  For the purposes of these definitions, damage also includes motor vehicles that have been flooded or damaged by water.

Transportation Code, Section 501.095, requires a salvage or nonrepairable motor vehicle be issued the applicable title prior to subsequent transfer of ownership to anyone other than a licensed salvage vehicle dealer, metal recycler, or used automotive parts recycler.  If a VSF takes possession of a salvage or nonrepairable motor vehicle that is not claimed following the statutory notifications under Occupations Code, Chapter 2303, the VSF must first obtain a Salvage Vehicle Title, Nonrepairable Vehicle Title, or Certificate of Authority (COA) to Dispose of a Motor Vehicle to a Demolisher in the name of the VSF prior to offering the motor vehicle for public sale or otherwise transferring ownership to anyone other than a licensed salvage vehicle dealer, metal recycler, or used automotive parts recycler.

Note: A VSF may only transfer ownership of a salvage or nonrepairable motor vehicle to a licensed salvage vehicle dealer, metal recycler, or used automotive parts recycler without first obtaining the appropriate title document.  The transfer to one of these licensed entities will occur on the Licensed Vehicle Storage Facility Lien Foreclosure (Form VTR-265-VSF).  The licensed entity who is transferred ownership will be responsible for using the VTR-265-VSF to obtain the appropriate title document or report the vehicle to the department (as applicable).  However, the department strongly recommends a VSF obtain the appropriate title prior to transferring a motor vehicle to these entities as well.

In order to obtain a Salvage Vehicle Title, Nonrepairable Vehicle Title, or COA in the name of the VSF prior to offering a motor vehicle at public sale or otherwise transferring ownership:

  1. Complete the Licensed Vehicle Storage Facility Lien Foreclosure (Form VTR-265-VSF), and record your VSF as the “Purchaser” in all applicable fields.
  2. Complete one of the following applications (as applicable), and record the name and address of the VSF in the “Applicant Information” section:
    • Application for Salvage or Nonrepairable Vehicle Title (Form VTR-441)
    • Application for Authority to Dispose of a Motor Vehicle to a Demolisher after Statutory Foreclosure (Form VTR-71-6)
  3. Submit the Form VTR-441 or VTR-71-6 and the applicable fee along with the Form VTR-265-VSF and all required documents (e.g., proof of mailing, title and/or registration verification, etc.) directly to the department at:
Texas Department of Motor Vehicles
Vehicle Titles and Registration Division
ATTN: Title Control Systems
Austin, Texas 78779-0001 

  

Upon receipt of a properly completed application, the department will issue and mail you the applicable Salvage Vehicle Title, Nonrepairable Vehicle Title, or COA.  Once you receive one of these documents from the department, you can transfer the motor vehicle by signing as the seller on the document.  A subsequent purchaser of the vehicle will only need to be provided with one of these documents where you have signed as the seller.  No further documentation will be required from the VSF.

If you have questions regarding this process, please contact the Vehicle Titles and Registration Division at (512) 465-5659, option 1.

Thank you,

Jeremiah Kuntz, Director
Vehicle Titles and Registration Division
Texas Department of Motor Vehicles

JK:TT:TH

If you have any comments or suggestions concerning this VTR communication process, please contact your local TxDMV Regional Service Center.

 

Source: Licensed Vehicle Storage Facilities
Salvage and Nonrepairable Vehicles Obtained by Licensed Vehicle Storage Facilities

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