Lower your car payment in Michigan

What’s different about refinancing a car loan in Michigan

Vehicle titles in Michigan are issued by the Michigan Department of State (Secretary of State).

• Under Michigan's Electronic Lien and Title program, established by Public Acts 290-292 of 2014, vehicle titles are held electronically by the Michigan Department of State, and all financial institutions and entities engaged in the business of financing vehicles or watercraft are required to enroll.

  Source: Michigan Department of State - Electronic Lien and Title (ELT) program

• Michigan law directs that when an owner creates a security interest the certificate names the holder of that interest, but the Secretary of State is not required to issue a title to the owner of a vehicle while the title remains subject to a security interest.

  Source: Michigan Legislature - MCL 257.238, Michigan Vehicle Code

• A Michigan secured party must execute a release of its security interest in the manner prescribed by the department not more than fourteen days after receiving payment satisfying the loan, and where the title is held electronically the release is delivered to the department, which cancels the security interest.

  Source: Michigan Legislature - MCL 257.241, electronic lien title system

• When a Michigan lienholder completes the electronic lien release after a loan is paid off, the Michigan Department of State automatically prints and mails a paper title to the vehicle owner the next business day, and the lienholder may enter a one-time updated mailing address if the owner moved.

  Source: Michigan Department of State - Electronic Lien and Title (ELT) FAQs

• Lienholders and financial institutions participating in Michigan's Electronic Lien and Title program are required to electronically release liens or add liens when refinancing, so a vehicle owner does not need to visit a Secretary of State office to add or remove a lienholder on an electronically held title.

  Source: Michigan Department of State - Vehicle Titles FAQs

• A buyer under a Michigan motor vehicle installment sale contract may prepay all or part of the unpaid time balance at any time, and when the balance is liquidated early by prepayment or refinancing the holder must immediately rebate the unearned portion of the finance charge using the actuarial method.

  Source: Michigan Legislature - MCL 492.121, Motor Vehicle Sales Finance Act

• After default a Michigan secured party may take possession of the collateral vehicle either pursuant to judicial process, or without judicial process only if it proceeds without a breach of the peace, and may require the debtor to assemble and make the collateral available at a reasonably convenient place.

  Source: Michigan Legislature - MCL 440.9609, Uniform Commercial Code

• A Michigan debtor, co-signer, or other lienholder may redeem a repossessed vehicle at any time before the secured party disposes of it, contracts for its disposition, or accepts it in satisfaction, but redemption requires tendering the entire secured obligation plus reasonable expenses and attorney fees, not merely the past-due payments.

  Source: Michigan Legislature - MCL 440.9623, right to redeem collateral

• If a Michigan consumer is liable for a deficiency after a repossession sale, the secured party must send a written explanation stating the secured obligation, the proceeds of the sale, itemized retaking and disposition expenses, any rebates credited to the borrower, and the resulting deficiency figure.

  Source: Michigan Legislature - MCL 440.9616, explanation of surplus or deficiency

These are general procedural facts about Michigan, 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.