§ 2045. Release of security interest

(a) Upon satisfaction of a security interest in a vehicle for which the lienholder possesses the certificate of title, the lienholder shall, within 12 business days after a request for release of the security interest, fully execute a release of the security interest in the space provided therefor on the certificate or in the form the Commissioner prescribes, and mail or deliver the certificate and release to the next lienholder named therein, or, if none, to the owner or any person authorized by the owner to receive the certificate (hereafter, "owner's designee"). The owner or the owner's designee, other than a dealer holding the vehicle for resale, shall promptly cause the certificate and release to be mailed or delivered to the Commissioner, who shall release the lienholder's rights on the certificate or issue a new certificate.

(b) Upon satisfaction of the security interest of a subordinate lienholder who does not possess the certificate of title, the subordinate lienholder shall, within 12 business days after a request for release of the security interest, fully execute a release in the form the Commissioner prescribes and deliver the release to the owner or the owner's designee. The lienholder in possession of the certificate of title shall either deliver the certificate to the owner or the owner's designee for delivery to the Commissioner or, if the lienholder in possession receives the release, mail or deliver it with the certificate to the Commissioner, who shall release the subordinate lienholder's rights on the certificate or issue a new certificate. A subordinate lienholder whose security interest is fully satisfied but receives the certificate of title pursuant to subsection (a) of this section shall, within three business days of its receipt, mail or deliver the title to the owner or the owner's designee.

(c) For purposes of subsections (a) and (b) of this section, a release not sent by electronic means is deemed fully executed when it is completed and placed in the United States mail postage prepaid or delivered to the person requesting the release as shown on the form so requesting it.

(d) A lienholder that fails to satisfy the requirements of subsection (a) or (b) of this section shall, upon written demand sent by certified mail, be liable to pay the owner or the owner's designee $25.00 per day for each day that the requirements of subsection (a) or (b) remain unsatisfied, up to a maximum of $2,500.00, in addition to any other remedies that may be available at law or equity. If the lienholder fails to pay the amount owed under this subsection within 60 days following the written demand, the owner or the owner's designee may bring a civil action and, if the lienholder is found to have violated subsection (a) or (b) of this section, the amount owed under this subsection shall be trebled, resulting in an award of up to $7,500.00, and reasonable attorney's fees and costs shall be awarded. (Added 1969, No. 297 (Adj. Sess.), § 1, eff. Sept. 1, 1971; amended 2011, No. 46, § 14.)