Arkansas Lost Title Bond: A Comprehensive Guide

This guide provides information for insurance agents to help their customers obtain an Arkansas Lost Title Bond

At a Glance:

• Lowest Cost: $100 per year
• Bond Amount: Equal to one and a half times the value of the vehicle as determined by the Commissioner of Revenue
• Who Needs it: Vehicle title applicants in Arkansas who do not have adequate proof of ownership
• Purpose: To ensure the rightful vehicle owner does not suffer financial harm if the title applicant does not actually own the vehicle
• Who Regulates Lost Title Bonds In Arkansas: The Arkansas Commissioner of Revenue

Background

Arkansas Statute 27-14-109 requires residents who never received or have lost their vehicle title to purchase a surety bond prior to obtaining their duplicate title. The Arkansas legislature enacted the bonding requirement to ensure that the rightful vehicle owner will receive compensation if the title applicant does not actually own the vehicle. The bond must remain in effect for three years. If the vehicle’s ownership is not contested within this time then the bond will no longer be required and the vehicle owner can apply for a standard certificate of title. The bond amount must be equal to one and a half times the vehicle’s value as determined by the Commissioner of Revenue.

What is the Purpose of the Arkansas Lost Title Bond?

Arkansas requires residents to purchase a surety bond as part of the application process to obtain a duplicate title. The bond ensures that the rightful vehicle owner will not suffer a financial loss if the title applicant is seeking to obtain the title fraudulently. If the title applicant is engaging in fraud, then the rightful vehicle owner can file a claim against the bond and receive compensation up to the full amount of the bond. In short, the bond acts as a safeguard against people attempting to obtain ownership of a vehicle through unethical means.

How Can an Insurance Agent Obtain an Arkansas Lost Title Bond?

BondExchange makes obtaining an Arkansas Lost Title Bond easy. Simply log in to your account and use our keyword search to find the “title” bond in our database. Don’t have a login? Gain access now and let us help you satisfy your customers’ needs. Our friendly underwriting staff is available by phone at (800) 438-1162, email, or chat from 7:30 AM to 7:00 PM EST to assist you.

At BondExchange, our 40 years of experience, leading technology, and access to markets ensures that we have the knowledge and resources to provide your clients with fast and friendly service whether obtaining quotes or issuing bonds.

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How is the Bond Amount Determined?

Arkansas statute 27-14-409 dictates that the limit on the lost title bond must be equal to one and a half times the vehicle’s value as determined by the Commissioner of Revenue.

Is a Credit Check Required for the Arkansas Lost Title Bond?

Surety companies will not conduct a credit check for bonds that are less than $25,000. At limits over $25,000, surety companies will review the applicant’s credit standing to determine qualification for the bond. For larger bond amounts, applicants with poor credit may be subject to a higher rate. Generally, most carriers want to have an understanding as to how the applicant came to have ownership of the vehicle.

How Much Does the Arkansas Lost Title Bond Cost?

The Arkansas Lost Title Bond costs either $100 or 1.5% of the bond amount, whichever is greater (rates may vary for bonds greater than $25,000).

Who is Required to Purchase a Bond?

The Arkansas Commissioner of Revenue will require a title applicant to purchase a surety bond if they cannot determine with certainty that the title applicant actually owns the vehicle. Typically, title applicants will need to obtain a surety bond in the following situations:

• The vehicle has never been titled
• The applicant never received the title
• The previous owner never titled the vehicle
• The applicant has the title but there is an error in the title transfer
• The applicant purchased an unclaimed/abandoned vehicle and is not a bonded agent

Title applicants will not be issued a surety bond if any of the following conditions are met:

• The vehicle has been issued a junking certificate or similarly branded certificate of title
• The vehicle is subject to a mechanics or storage lien
• The vehicle is stolen
• The vehicle is involved in ownership litigation

How do Arkansas Residents Apply for a Bonded Title?

To apply for a bonded title, Arkansas residents must complete the following steps:

Step 1 – Have the Vehicle Inspected

Bonded title applicants must have their vehicle inspected by the Arkansas State Police, who will then provide the applicant with a form containing their vehicle identification number (VIN).

Step 2 – Complete the Statement of Facts Form

After receiving their VIN form from the Arkansas State Police, bonded title applicants must complete the Statement of Facts for Issuance of Bonded Title form

Step 3 – Mail the Documents

Once their statement of facts form is completed, bonded title applicants should mail the form, as well as the form containing their VIN number, to the following address:

Department of Finance and Administration
Office of Motor Vehicle – Bonded Titles
P.O. Box 1272
Little Rock, AR 72203

If the Department of Finance and Administration deems the applicant eligible to receive a bonded title, they will mail the applicant a surety bond form and instructions on how to file it.

How Do Arkansas Bonded Title Applicants File Their Bond?

In Arkansas, bonded title applicants should submit the completed bond form, including the power of attorney, to any Arkansas Office of Motor Vehicles office. The Arkansas Lost Title Surety Bond requires signatures from both the surety company that issues the bond and the title applicant. The surety company should include the following information on the bond form:

• The legal name and city of entity/individual(s) buying the bond
• Surety company’s name and address
• Bond amount
• Vehicle information
• Date the bond goes into effect
• Date the bond is signed

What Are the Insurance Requirements for Bonded Title Applicants in Arkansas?

Arkansas requires all motor vehicle owners to purchase auto insurance with the following limits:

• $25,000 bodily injury per person
• $50,000 bodily injury per accident
• $25,000 property damage

Bonded title applicants must purchase and maintain a surety bond equal to one and a half times the value of the motor vehicle.

How Can Arkansas Residents Avoid Claims Against Their Lost Title Bond?

To avoid claims against their bond, bonded title applicants in Arkansas must ensure that they are the rightful owners of the motor vehicle.

What Other Insurance Products Can Agents Offer Bonded Title Applicants in Arkansas?

Arkansas requires all motor vehicle owners to purchase auto insurance. Bonds are our only business at BondExchange, so we do not issue other types of insurance, but our agents often utilize brokers for this specific line of business. A list of brokers in this space can be found here.