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1 STATE OF OKLAHOMA
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2 1st Session of the 60th Legislature (2025)
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3 SENATE BILL 565 By: Hall
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6 AS INTRODUCED
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7 An Act relating to the Oklahoma Vehicle License and
7 Registration Act; amending 47 O.S. 2021, Section
8 1110, as last amended by Section 1, Chapter 323,
8 O.S.L. 2024 (47 O.S. Supp. 2024, Section 1110), which
9 relates to security interests; modifying provisions
9 related to certain transfer of title; modifying
10 provisions related to mailing of certain release; and
10 providing an effective date.
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13 BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
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14 SECTION 1. AMENDATORY 47 O.S. 2021, Section 1110, as
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15 last amended by Section 1, Chapter 323, O.S.L. 2024 (47 O.S. Supp.
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16 2024, Section 1110), is amended to read as follows:
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17 Section 1110. A. 1. Except for a security interest in
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18 vehicles held by a dealer for sale or lease, a vehicle registered by
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19 a federally recognized Indian tribe as provided in subsection G of
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20 this section, and a vehicle being registered in this state which was
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21 previously registered in another state and which title contains the
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22 name of a secured party on the face of the other state certificate
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23 or title, and except as otherwise provided in subsection B of
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24 Section 1105 of this title, a security interest in a vehicle as to
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Req. No. 1187 Page 1
1 which a certificate of title may be properly issued by the Oklahoma
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2 Tax Commission shall be perfected only when a lien entry form, and
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3 the existing certificate of title, if any, or application for a
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4 certificate of title and manufacturer's certificate of origin
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5 containing the name and address of the secured party and the date of
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6 the security agreement and the required fee are delivered to the Tax
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7 Commission or to a motor license agent. As used in this section,
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8 the term "dealer" shall be defined as provided in Section 1-112 of
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9 this title and the term "security interest" shall be defined as
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10 provided in paragraph (35) of Section 1-201 of Title 12A of the
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11 Oklahoma Statutes. When a vehicle title is presented to a motor
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12 license agent for transferring or registering and the documents
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13 reflect a lienholder, the motor license agent shall perfect the lien
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14 pursuant to subsection G of Section 1105 of this title. For the
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15 purposes of this section, the term "vehicle" shall not include
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16 special mobilized machinery, machinery used in highway construction
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17 or road material construction, and rubber-tired road construction
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18 vehicles including rubber-tired cranes. The filing and duration of
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19 perfection of a security interest, pursuant to the provisions of
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20 Title 12A of the Oklahoma Statutes including, but not limited to,
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21 Section 1-9-311 of Title 12A of the Oklahoma Statutes, shall not be
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22 applicable to perfection of security interests in vehicles as to
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23 which a certificate of title may be properly issued by the Tax
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24 Commission, except as to vehicles held by a dealer for sale or lease
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Req. No. 1187 Page 2
1 and except as provided in subsection D of this section. In all
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2 other respects Title 12A of the Oklahoma Statutes shall be
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3 applicable to such security interests in vehicles as to which a
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4 certificate of title may be properly issued by the Tax Commission.
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5 2. Whenever a person creates a security interest in a vehicle,
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6 the person shall surrender to the secured party the certificate of
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7 title or the signed application for a new certificate of title, on
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8 the form prescribed by the Tax Commission, and the manufacturer's
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9 certificate of origin. The secured party shall deliver the lien
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10 entry form and the required lien filing fee within twenty-five (25)
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11 days as provided hereafter with certificate of title or the
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12 application for certificate of title and the manufacturer's
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13 certificate of origin to the Tax Commission or to a motor license
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14 agent. If the lien entry form, the lien filing fee and the
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15 certificate of title or application for certificate of title and the
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16 manufacturer's certificate of origin are delivered to the Tax
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17 Commission or to a motor license agent within twenty-five (25) days
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18 after the date of the lien entry form, perfection of the security
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19 interest shall begin from the date of the execution of the lien
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20 entry form, but otherwise, perfection of the security interest shall
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21 begin from the date of the delivery to the Tax Commission or to a
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22 motor license agent.
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23 3. a. For each security interest recorded on a certificate
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24 of title, or manufacturer's certificate of origin,
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Req. No. 1187 Page 3
1 such person shall pay a fee of Ten Dollars ($10.00),
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2 which shall be in addition to other fees provided for
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3 in the Oklahoma Vehicle License and Registration Act.
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4 Upon the receipt of the lien entry form and the
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5 required fees with either the certificate of title or
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6 an application for certificate of title and
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7 manufacturer's certificate of origin, a motor license
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8 agent shall, by placement of a clearly distinguishing
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9 mark, record the date and number shown in a
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10 conspicuous place, on each of these instruments. Of
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11 the ten-dollar fee, the motor license agent shall
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12 retain Two Dollars ($2.00) for recording the security
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13 interest lien.
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14 b. It shall be unlawful for any person to solicit,
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15 accept, or receive any gratuity or compensation for
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16 acting as a messenger and for acting as the agent or
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17 representative of another person in applying for the
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18 recording of a security interest or for the
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19 registration of a motor vehicle and obtaining the
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20 license plates or for the issuance of a certificate of
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21 title therefor unless the Tax Commission has appointed
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22 and approved the person to perform such acts; and
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23 before acting as a messenger, any such person shall
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24 furnish to the Tax Commission a surety bond in such
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Req. No. 1187 Page 4
1 amount as the Tax Commission shall determine
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2 appropriate.
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3 4. The certificate of title or the application for certificate
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4 of title and manufacturer's certificate of origin with the record of
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5 the date of receipt clearly marked thereon shall be returned to the
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6 debtor together with a notice that the debtor is required to
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7 register and pay all additional fees and taxes due within thirty
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8 (30) days from the date of purchase of the vehicle.
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9 5. Any person creating a security interest in a vehicle that
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10 has been previously registered in the debtor's name and on which all
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11 taxes due the state have been paid shall surrender the certificate
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12 of ownership to the secured party. The secured party shall have the
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13 duty to record the security interest as provided in this section and
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14 shall, at the same time, obtain a new certificate of title which
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15 shall show the secured interest on the face of the certificate of
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16 title.
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17 6. The lien entry form with the date and assigned number
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18 thereof clearly marked thereon shall be returned to the secured
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19 party. If the lien entry form is received and authenticated, as
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20 herein provided, by a motor license agent, the agent shall make a
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21 report thereof to the Tax Commission upon the forms and in the
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22 manner as may be prescribed by the Tax Commission.
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1 7. The Tax Commission shall have the duty to record the lien
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2 upon the face of the certificate of title issued at the time of
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3 registering and paying all fees and taxes due on the vehicle.
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4 8. When there is an active lien from a commercial lender in
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5 place on a vehicle, motor license agents shall be prohibited from
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6 transferring the certificate of title on that vehicle until the lien
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7 is satisfied, except when the title is transferred:
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8 a. to a person whose name is included on the loan for
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9 which the lien is placed pursuant to an agreement by
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10 the lender and any party to the title,
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11 b. to a trust created by a person whose name is included
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12 on the loan for which the lien is placed, or
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13 c. from a person who has died, upon the submission of a
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14 death certificate, or
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15 d. upon attestation by the managing member indicating
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16 ownership, to a business entity from a person who owns
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17 at least fifty percent (50%) of the business entity
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18 receiving title. As part of such transfer, the
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19 business entity receiving title and at the discretion
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20 of the financial institution holding the lien, the
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21 individual transferring title and the receiving
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22 business entity may be added as an obligor to the
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23 original note secured by the collateral to which the
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24 transferring individual is a borrower. This shall not
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Req. No. 1187 Page 6
1 be construed to require refinancing of the original
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2 note. Service Oklahoma shall provide notification of
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3 the transaction to the lienholder, ninety (90) days
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4 prior to effectuating the title transfer and shall
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5 develop an appropriate affidavit and notice necessary
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6 to effectuate a transfer of title. A title transfer
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7 initiated pursuant to this subparagraph shall not
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8 preclude the lienholder from exercising all remedies
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9 available to it in accordance with an agreement
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10 between the lienholder and the individual transferring
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11 title, up to and including repossession of the vehicle
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12 and civil action against the individual transferring
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13 title and receiving business entity. Further, until
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14 the original lien is satisfied, the receiving business
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15 entity shall be prohibited from transferring title to
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16 another entity or person. Types of business entities
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17 that may receive a transfer of title pursuant to this
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18 subparagraph shall be limited to:
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19 (1) sole proprietorships,
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20 (2) general partnerships,
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21 (3) limited partnerships,
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22 (4) limited liability companies,
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23 (5) professional limited partnerships, and
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24 (6) professional limited liability companies.
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1 No individual may perform a transfer, pursuant to this
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2 subparagraph, to any business entity that is currently
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3 engaging in any activity which is prohibited by federal or
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4 state law.
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5 The provisions of this paragraph shall not be construed to release
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6 any lien or debt based solely upon a transfer of certificate of
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7 title.
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8 B. 1. A secured party shall, within seven (7) business days
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9 after the satisfaction of the security interest, furnish directly or
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10 by mail a release of a security interest to the Tax Commission and
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11 mail a copy thereof to the last-known address of the debtor. If the
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12 security interest has been satisfied by payment from a licensed used
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13 motor vehicle dealer to whom the motor vehicle has been transferred,
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14 the secured party shall also, within seven (7) business days after
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15 such satisfaction receipt of a written request from such licensed
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16 used motor vehicle dealer, mail an additional copy of the release to
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17 the dealer. If the secured party fails to furnish the release as
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18 required, the secured party shall be liable to the debtor for a
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19 penalty of One Hundred Dollars ($100.00). Following the seven (7)
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20 business days after satisfaction of the lien and upon receipt by the
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21 lienholder of written communication demanding the release of the
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22 lien, thereafter the penalty shall increase to One Hundred Dollars
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23 ($100.00) per day for each additional day beyond seven (7) business
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24 days until accumulating to One Thousand Five Hundred Dollars
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Req. No. 1187 Page 8
1 ($1,500.00) or the value of the vehicle, whichever is less, and, in
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2 addition, any loss caused to the debtor by such failure.
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3 2. Upon release of a security interest the owner may obtain a
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4 new certificate of title omitting reference to the security
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5 interest, by submitting to the Tax Commission or to a motor license
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6 agent:
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7 a. a release signed by the secured party, an application
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8 for new certificate of title and the proper fees, or
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9 b. by submitting to the Tax Commission or the motor
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10 license agent an affidavit, supported by such
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11 documentation as the Tax Commission may require, by
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12 the owner on a form prescribed by the Tax Commission
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13 stating that the security interest has been satisfied
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14 and stating the reasons why a release cannot be
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15 obtained, an application for a new certificate of
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16 title and the proper fees.
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17 Upon receiving such affidavit that the security interest has been
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18 satisfied, the Tax Commission shall issue a new certificate of title
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19 eliminating the satisfied security interest and the name and address
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20 of the secured parties who have been paid and satisfied. The Tax
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21 Commission shall accept a release of a security interest in any form
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22 that identifies the debtor, the secured party, and the vehicle, and
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23 contains the signature of the secured party. The Tax Commission
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Req. No. 1187 Page 9
1 shall not require any particular form for the release of a security
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2 interest.
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3 The words "security interest" when used in the Oklahoma Vehicle
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4 License and Registration Act do not include liens dependent upon
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5 possession.
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6 C. The Tax Commission shall file and index certificates of
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7 title so that at all times it will be possible to trace a
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8 certificate of title to the vehicle designated therein, identify the
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9 lien entry form, and the names and addresses of secured parties, or
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10 their assignees, so that all or any part of such information may be
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11 made readily available to those who make legitimate inquiry of the
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12 Tax Commission as to the existence or nonexistence of security
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13 interest in the vehicle.
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14 D. 1. Any security interest in a vehicle properly perfected
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15 prior to July 1, 1979, may be continued as to its effectiveness or
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16 duration as provided by Sections 1-9-510 and 1-9-515 of Title 12A of
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17 the Oklahoma Statutes, or may be terminated, assigned or released as
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18 provided by Sections 1-9-512, 1-9-513 and 1-9-514 of Title 12A of
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19 the Oklahoma Statutes, as fully as if this section had not been
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20 enacted, or, at the option of the secured party, may also be
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21 perfected under this section, and, if so perfected, the time of
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22 perfection under this section shall be the date the security
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23 interest was originally perfected under the prior law.
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1 2. Upon request of the secured party, the debtor, or any other
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2 holder of the certificate of title shall surrender the certificate
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3 of title to the secured party and shall do such other acts as may be
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4 required to perfect the security interest under this section.
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5 E. If a manufactured home is permanently affixed to real
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6 estate, an Oklahoma certificate of title may be surrendered to the
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7 Tax Commission or a motor license agent for cancellation. When the
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8 document of title is surrendered, the owner shall provide the legal
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9 description or the appropriate tract or parcel number of the real
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10 estate and other information as may be required on a form provided
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11 by the Tax Commission. The Tax Commission may not cancel a document
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12 of title if a lien has been registered or recorded. The Tax
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13 Commission or motor license agent shall notify the owner and any
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14 lienholder that the title has been surrendered to the Tax Commission
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15 and that the Tax Commission may not cancel the title until the lien
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16 is released. Such notification shall include a description of the
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17 lien and such notification to the owner shall be accompanied by the
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18 return of title surrendered. Permanent attachment to real estate
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19 does not affect the validity of a lien recorded or registered with
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20 the Tax Commission before the document of title is canceled pursuant
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21 to this section. The rights of a prior lienholder pursuant to a
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22 security agreement or the provisions of a credit transaction and the
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23 rights of the state pursuant to a tax lien are preserved. The Tax
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24 Commission or motor license agent shall forward the information to
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Req. No. 1187 Page 11
1 the county assessor of the county where the real estate is located
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2 and indicate whether the original document of title has been
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3 canceled. A fee of Five Dollars ($5.00) shall accompany the
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4 application for cancellation of title. When the fee is paid by a
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5 person making an application directly with the Tax Commission, the
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6 fee shall be deposited in the Oklahoma Tax Commission Revolving
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7 Fund. A fee paid to a motor license agent shall be retained by the
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8 agent. The owner of a manufactured home upon which the document of
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9 title has been properly surrendered, may apply to the Tax Commission
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10 for issuance of a new original certificate of title upon submission
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11 of:
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12 1. An attestation from the homeowner indicating ownership of
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13 the manufactured home and the nonexistence of any security interest
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14 or lien of record in the manufactured home; and
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15 2. A title opinion by a licensed attorney, determining that the
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16 owner of the manufactured home has marketable title to the real
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17 property upon which the manufactured home is located and that no
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18 documents filed of record in the county clerk's office concerning
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19 the real property contain a mortgage, recorded financial statement,
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20 judgment, or lien of record. Persons or entities to whom the title
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21 opinion is addressed may rely on the title opinion. A security
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22 interest in a manufactured home perfected pursuant to this section
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23 shall have priority over a conflicting interest of a mortgagee or
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24 other lien encumbrancer, or the owner of the real property upon
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Req. No. 1187 Page 12
1 which the manufactured home became affixed or otherwise permanently
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2 attached. The holder of the security interest in the manufactured
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3 home, upon default, may remove the manufactured home from such real
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4 property. The holder of the security interest in the manufactured
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5 home shall reimburse the owner of the real property who is not the
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6 debtor and who has not otherwise agreed to access the real property
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7 for the cost of repair of any physical injury to the real property,
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8 but shall not be liable for any diminution in value to the real
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9 property caused by the removal of the manufactured home, trespass,
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10 or any other damages caused by the removal. The debtor shall notify
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11 the holder of the security interest in the manufactured home of the
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12 street address, if any, and the legal description of the real
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13 property upon which the manufactured home is affixed or otherwise
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14 permanently attached and shall sign such other documents, including
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15 any appropriate mortgage, as may reasonably be requested by the
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16 holder of such security interest.
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17 F. In the case of motor vehicles or trailers, notwithstanding
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18 any other provision of law, a transaction does not create a sale or
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19 security interest merely because it provides that the rental price
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20 is permitted or required to be adjusted under the agreement either
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21 upward or downward by reference to the amount realized upon sale or
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22 other disposition of the motor vehicle or trailer.
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23 G. A security interest in vehicles registered by a federally
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24 recognized Indian tribe shall be deemed valid under Oklahoma law if
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Req. No. 1187 Page 13
1 validly perfected under the applicable tribal law and the lien is
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2 noted on the face of the tribal certificate of title.
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3 SECTION 2. This act shall become effective November 1, 2025.
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5 60-1-1187 CN 1/19/2025 5:38:50 AM
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Req. No. 1187 Page 14Every fact on this page links to its source, starting with the official bill record.