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We may seize a car with a $4600 lien on it, according to DPS. The officer contacted the lien holder, which is a used car dealership. The dealership claims the lien is more than $4600.

If true, is it enforceable once we seize the car and give everyone notice?

Are liens only enforceable if the lien is filed on the vehicle prior to a sale/transfer, etc.?
 
Posts: 286 | Registered: February 13, 2006Reply With QuoteReport This Post
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59.01(4) defines "interest holder" as a "bona fide holder of a perfected lien or a perfected security interest in property." If your lienholder has not taken the necessary steps to perfect his lien then he cannot assert his interest in the forfeiture proceeding. Furthermore, 59.06(f) provides that "a final judgment of forfeiture...perfects the title of the state to the property as of the date that the contraband was seized or the date the forfeiture action was filed, whichever occurred first..." This means the judgment of forfeiture cuts off claims for late payments, late fees and interest accruing during the pendency of the forfeiture proceeding. All the lienholder gets is what was perfected and owed at the time of seizure or filing, whichever comes first. (The lienholder can still pursue collection against the former owner...but without the benefit of the secured interest.)
 
Posts: 188 | Location: Lubbock, Texas USA | Registered: October 04, 2002Reply With QuoteReport This Post
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John, thank you. That's the same conclusion I came to.
 
Posts: 286 | Registered: February 13, 2006Reply With QuoteReport This Post
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I am having a bank balk at the valuation of their interest as what was perfected at the time of the seizure of the vehicle. Bank is trying to get an award of late payments, late fees, interest and attorney fees.

Anyone have case law to cite the courts to establish a correct interpretation of 59.06(f)?
 
Posts: 4 | Location: Amarillo, TX | Registered: January 26, 2016Reply With QuoteReport This Post
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