A bonded title is a title with a surety bond attached to it, which is issued when a person has obtained ownership of a vehicle but lacks a valid title that will allow that vehicle to be transferred into the new owner’s name and registered. Bonded titles are also known as lost title bonds, DMV bonds, certificate of title bonds, and defective title bonds. The surety bond protects previous owners and individuals with a security interest in the vehicle. The bonded title allows the new owner to claim ownership of the vehicle and register, insure, or sell it legally.

The process of obtaining a bonded title varies by state, but generally, the vehicle owner must fill out a title application and the corresponding forms, provide information about the vehicles odometer, cost, and the owner, and purchase a surety bond. The surety bond is valid for a certain period, usually three years, and the bonded title remains effective without needing renewal.

In California, a bonded title is necessary if the vehicle owner does not have a title for the vehicle in their name and has no way of obtaining it. This situation can occur when cars are sold without a title, a buyer only receives a bill of sale, a buyer loses the title before transferring the title to their name, or the original title is defective. The California Department of Motor Vehicles accepts a bonded title as an alternative to the vehicles original title when proof of ownership is not available.

It is important to note that a bonded title is not the same as a security bond or a lost title bond. A bonded title is a certificate of title issued by a state DMV that is backed by a surety bond, which means that the company issuing the bond will take on the owners liability to another party if they fail to fulfill their legal obligations surrounding ownership of the asset.