Lower your car payment in Massachusetts

What’s different about refinancing a car loan in Massachusetts

Vehicle titles in Massachusetts are issued by the Massachusetts Registry of Motor Vehicles (RMV), a division of the Massachusetts Department of Transportation (MassDOT).

• Massachusetts runs an Electronic Lien and Title (ELT) program. Instead of printing a paper title and mailing it to the lienholder, the Registry transmits an electronic record of the Certificate of Title to a participating lienholder. The record stays electronic until the loan is satisfied, the vehicle is repossessed, the lienholder requests a paper title, or the owner moves out of state and needs paper for registration elsewhere. In each of those cases the RMV mails the title the business day after it receives the lienholder's electronic message.

  Source: Massachusetts Registry of Motor Vehicles — Electronic Lien and Title (ELT) Program

• When a car loan is paid off and the lienholder holds the certificate of title, Massachusetts General Laws Chapter 90D, Section 24 requires that lienholder to execute a release of its security interest within three days after demand and, in any event, within ten days, then mail or deliver the certificate and release to the next lienholder named on it or, if there is none, to the owner or a person the owner authorizes in writing to receive it.

  Source: Massachusetts General Laws Chapter 90D, Section 24 — Satisfaction of security interest in vehicle

• The same statute removes the usual excuse for a slow payoff release: if the payment satisfying the security interest is made in cash, or by certified check, cashier's check, teller's check, intra-bank or inter-bank transfer of funds, or an electronic transfer of funds, that payment is considered cleared immediately upon receipt by the lienholder, so the release deadline is not extended while a lender waits for funds to settle.

  Source: Massachusetts General Laws Chapter 90D, Section 24 — Satisfaction of security interest in vehicle

• Before a secured creditor in a consumer credit transaction can sue the borrower or proceed against the vehicle after a default, Chapter 255B, Section 20A requires a written notice given ten days or more after the default, headed "Rights of Defaulting Buyer under the Massachusetts Motor Vehicle Installment Sales Act." For twenty-one days after that notice is delivered the creditor may not accelerate the unpaid balance, bring an action, or proceed against the collateral, and paying the amount stated restores the borrower as though no default had occurred.

  Source: Massachusetts General Laws Chapter 255B, Section 20A — Default; enforcement; notice; accelerated payment; curing of defa

• If the vehicle is repossessed, Chapter 255B, Section 20B lets the borrower redeem the collateral from the holder at any time within twenty days of the creditor taking possession, or later until the creditor has disposed of it, contracted to dispose of it, or gained the right to keep it in satisfaction of the debt. Where the unpaid balance at default is at or below the threshold stated in that section and the security interest is a non-possessory interest in consumer goods, the debtor is not liable for any deficiency; above that threshold the creditor may pursue a deficiency only after complying with the section, and the collateral's fair market value is a question for the court.

  Source: Massachusetts General Laws Chapter 255B, Section 20B — Repossession of collateral on default; hearing; redemption; dispo

• Massachusetts protects the right to pay a motor vehicle retail installment contract off early, which is what happens to the old loan when you refinance. Chapter 255B, Section 16 provides that notwithstanding anything in the contract to the contrary, any buyer may pay the debt in full at any time before maturity and must receive a refund credit for that anticipation, computed by a method at least as favorable to the buyer as the actuarial method.

  Source: Massachusetts General Laws Chapter 255B, Section 16 — Payment in full before maturity; refund credit

• To swap lenders on the title, the RMV requires the original certificate of title with the previous lien released, stamped and signed by the previous lienholder, or a lienholder release letter on the lienholder's letterhead, together with a completed Title Amendment Application with the "Add a Lienholder" option checked. The RMV also warns that adding or deleting an owner is not treated as a correction at all: it is a transfer of ownership, and a new original title must be applied for.

  Source: Massachusetts Registry of Motor Vehicles — Change information on your vehicle title

These are general procedural facts about Massachusetts, not advice about your loan. Rules change, and your lender’s own process may add steps — a licensed specialist can tell you what applies to your situation.