PARRIS N. GLENDENING, Governor                             Ch. 233

CHAPTER 233
(House Bill 500)

AN ACT concerning

Vehicle Laws - Security Interests - Reporting of Release

FOR the purpose of requiring a party who holds a security interest in certain vehicles to
deliver a copy of a security interest release form to a licensed dealer who pays off
the security interest on behalf of the owner of the vehicle if the owner authorizes
the secured party in writing to provide a copy of the release to the dealer.

BY repealing and reenacting, with amendments,
Article - Transportation
Section 13-205
Annotated Code of Maryland
(1992 Replacement Volume and 1995 Supplement)

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF
MARYLAND, That the Laws of Maryland read as follows:

Article - Transportation

13-205.

(a)     When a security interest in a vehicle is satisfied, the secured party shall
execute a release of the security interest on the form that the Administration requires.

(b)     When a security interest in a vehicle is satisfied, the secured party shall
immediately deliver copies of the release to:

(1)      [the] THE owner [and to];

(2)      [ the] THE Administration; AND

(3)     A DEALER LICENSED UNDER TITLE 15, SUBTITLE 3 OF THIS ARTICLE
WHO, ON BEHALF OF THE OWNER, PAYS OFF THE SECURITY INTEREST IF THE
OWNER AUTHORIZES THE SECURED PARTY IN WRITING TO DELIVER A COPY OF THE
RELEASE TO THE DEALER.

(c)     After it receives a release and the certificate of title, the Administration shall
release the secured party's right on the certificate of title or issue a new certificate of title.

(d)     (1) If, after notice to all interested parties and a hearing, the Administration
determines that an indebtedness does not constitute a security interest, it shall:

(i) Release the indebtedness on the certificate of title; or

(ii) Issue a new certificate of title and deliver the certificate to the
owner.

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