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Illinois Compiled Statutes

Information maintained by the Legislative Reference Bureau
Updating the database of the Illinois Compiled Statutes (ILCS) is an ongoing process. Recent laws may not yet be included in the ILCS database, but they are found on this site as Public Acts soon after they become law. For information concerning the relationship between statutes and Public Acts, refer to the Guide.

Because the statute database is maintained primarily for legislative drafting purposes, statutory changes are sometimes included in the statute database before they take effect. If the source note at the end of a Section of the statutes includes a Public Act that has not yet taken effect, the version of the law that is currently in effect may have already been removed from the database and you should refer to that Public Act to see the changes made to the current law.

VEHICLES
(625 ILCS 5/) Illinois Vehicle Code.

625 ILCS 5/Ch. 3 Art. II

 
    (625 ILCS 5/Ch. 3 Art. II heading)
ARTICLE II. SECURITY INTERESTS

625 ILCS 5/3-201

    (625 ILCS 5/3-201) (from Ch. 95 1/2, par. 3-201)
    Sec. 3-201. Excepted liens and security interests.
    This Article does not apply to or affect:
    (a) A lien given by statute or rule of law to a supplier of services or materials for the vehicle;
    (b) A lien given by statute to the United States, this State or any political subdivision of this State, except liens on trailer coaches and mobile homes for public assistance, as provided in Section 3-12 (now repealed) of the Illinois Public Aid Code.
    (c) A security interest in a vehicle created by a manufacturer or dealer who holds the vehicle for sale, but a buyer in the ordinary course of trade from the manufacturer or dealer takes free of the security interest.
(Source: P.A. 90-655, eff. 7-30-98.)

625 ILCS 5/3-201.1

    (625 ILCS 5/3-201.1) (from Ch. 95 1/2, par. 3-201.1)
    Sec. 3-201.1. Terminal rent adjustment clause leases. In the case of motor vehicles or trailers, a transaction does not create a sale or a security interest merely because it provides that the rental price is permitted or required to be adjusted under the agreement either upward or downward by reference to the amount realized upon sale or other disposition of the motor vehicle or trailer.
(Source: P.A. 87-493.)

625 ILCS 5/3-202

    (625 ILCS 5/3-202) (from Ch. 95 1/2, par. 3-202)
    Sec. 3-202. Perfection of security interest.
    (a) Unless excepted by Section 3-201, a security interest in a vehicle of a type for which a certificate of title is required is not valid against subsequent transferees or lienholders of the vehicle unless perfected as provided in this Act. A purchase money security interest in a manufactured home is perfected against the rights of judicial lien creditors and execution creditors on and after the date such purchase money security interest attaches.
    (b) A security interest is perfected by the delivery to the Secretary of State of the existing certificate of title, if any, an application for a certificate of title containing the name and address of the lienholder and the required fee. The security interest is perfected as of the time of its creation if the delivery to the Secretary of State is completed within 30 days after the creation of the security interest or receipt by the new lienholder of the existing certificate of title from a prior lienholder or licensed dealer, otherwise as of the time of the delivery.
    (c) If a vehicle is subject to a security interest when brought into this State, the validity of the security interest is determined by the law of the jurisdiction where the vehicle was when the security interest attached, subject to the following:
        1. If the parties understood at the time the security
    
interest attached that the vehicle would be kept in this State and it was brought into this State within 30 days thereafter for purposes other than transportation through this State, the validity of the security interest in this State is determined by the law of this State.
        2. If the security interest was perfected under the
    
law of the jurisdiction where the vehicle was when the security interest attached, the following rules apply:
            (A) If the name of the lienholder is shown on an
        
existing certificate of title issued by that jurisdiction, his security interest continues perfected in this State.
            (B) If the name of the lienholder is not shown on
        
an existing certificate of title issued by that jurisdiction, a security interest may be perfected by the lienholder delivering to the Secretary of State the prescribed notice and by payment of the required fee. Such security interest is perfected as of the time of delivery of the prescribed notice and payment of the required fee.
        3. If the security interest was not perfected under
    
the law of the jurisdiction where the vehicle was when the security interest attached, it may be perfected in this State; in that case perfection dates from the time of perfection in this State.
        4. A security interest may be perfected under
    
paragraph 3 of this subsection either as provided in subsection (b) or by the lienholder delivering to the Secretary of State a notice of security interest in the form the Secretary of State prescribes and the required fee.
    (d) Except as otherwise provided in Sections 3-116.1, 3-116.2, 3-207, and the Conveyance and Encumbrance of Manufactured Homes as Real Property and Severance Act, after a certificate of title has been issued for a manufactured home and as long as the manufactured home is subject to any security interest perfected pursuant to this Section, the Secretary of State shall not file an affidavit of affixation, nor cancel the Manufacturer's Statement of Origin, nor revoke the certificate of title, nor issue a certificate of title under Section 3-106, and, in any event, the validity and priority of any security interest perfected pursuant to this Section shall continue, notwithstanding the provision of any other law.
(Source: P.A. 98-749, eff. 7-16-14.)

625 ILCS 5/3-203

    (625 ILCS 5/3-203) (from Ch. 95 1/2, par. 3-203)
    Sec. 3-203. Security interest. If an owner creates a security interest in a vehicle:
    (a) The owner shall immediately execute the application, in the space provided therefor on the certificate of title or on a separate form the Secretary of State prescribes, to name the lienholder on the certificate, showing the name and address of the lienholder and cause the certificate, application and the required fee to be delivered to the lienholder.
    (b) The lienholder shall immediately cause the certificate, application and the required fee to be mailed or delivered to the Secretary of State.
    (c) Upon request of the owner or subordinate lienholder, a lienholder in possession of the certificate of title shall either mail or deliver the certificate to the subordinate lienholder for delivery to the Secretary of State or, upon receipt from the subordinate lienholder of the owner's application and the required fee, mail or deliver them to the Secretary of State with the certificate. The delivery of the certificate does not affect the rights of the first lienholder under his security agreement.
    (d) Upon receipt of the certificate of title, application and the required fee, the Secretary of State shall issue a new certificate containing the name and address of the new lienholder, and mail the certificate to the first lienholder named in it.
(Source: P.A. 85-511.)

625 ILCS 5/3-204

    (625 ILCS 5/3-204) (from Ch. 95 1/2, par. 3-204)
    Sec. 3-204. Assignment by lienholder. (a) A lienholder may assign, absolutely or otherwise, his security interest in the vehicle to a person other than the owner without affecting the interest of the owner or the validity of the security interest, but any person without notice of the assignment is protected in dealing with the lienholder as the holder of the security interest and the lienholder remains liable for any obligations as lienholder until the assignee is named as lienholder on the certificate.
    (b) The assignee may, but need not to perfect the assignment, have the certificate of title issued with the assignee named as lienholder, upon delivering to the Secretary of State the certificate and an assignment by the lienholder named in the certificate in the form the Secretary of State prescribes.
(Source: P.A. 85-511.)

625 ILCS 5/3-205

    (625 ILCS 5/3-205) (from Ch. 95 1/2, par. 3-205)
    Sec. 3-205. Release of security interest.
    (a) Within 21 days after receiving payment to satisfy a security interest in a vehicle for which the certificate of title is in the possession of the lienholder, he shall execute a release of his security interest, and mail or deliver the certificate and release to the next lienholder named therein, or, if none, to the owner or any person who delivers to the lienholder an authorization from the owner to receive the certificate. If the payment is in the form of cash, a cashier's check, or a certified check, the number of days is reduced to 10 business days. If the owner desires a new certificate reflecting no lien, the certificate and release from the lienholder may be submitted to the Secretary of State, along with the prescribed application and required fee, for issuance of that new certificate.
    (b) Within 21 days after receiving payment to satisfy a security interest in a vehicle for which the certificate of title is in the possession of a prior lienholder, the lienholder whose security interest is satisfied shall execute a release and deliver the release to the owner or any person who delivers to the lienholder an authorization from the owner to receive it. If the payment is in the form of cash, a cashier's check, or a certified check, the number of days is reduced to 10 business days. The lienholder in possession of the certificate of title may either deliver the certificate to the owner, or the person authorized by him, for delivery to the Secretary of State, or, upon receipt of the release, may mail or may deliver the certificate and release, along with prescribed application and require fee, to the Secretary of State, who shall issue a new certificate.
    (c) In addition to any other penalty, a lienholder who fails to execute a release of his or her security interest or who fails to mail or deliver the certificate and release within the time limit provided in subsection (a) or (b) is liable to the person or entity that was supposed to receive the release or certificate for $150 plus reasonable attorney fees and court costs. An action under this Section may be brought in small claims court or in any other appropriate court.
    (d) The holder of a security interest in or a lien on a manufactured home may deliver lien release documents to any person to facilitate conveying or encumbering the manufactured home. Any person receiving any such documents so delivered holds the documents in trust for the security interest holder or the lienholder.
(Source: P.A. 98-749, eff. 7-16-14.)

625 ILCS 5/3-206

    (625 ILCS 5/3-206) (from Ch. 95 1/2, par. 3-206)
    Sec. 3-206. Duty of lienholder.
    A lienholder named in a certificate of title shall, upon written request of the owner or of another lienholder named on the certificate, disclose any pertinent information as to his security agreement and the indebtedness secured by it.
(Source: P.A. 76-1586.)

625 ILCS 5/3-207

    (625 ILCS 5/3-207) (from Ch. 95 1/2, par. 3-207)
    Sec. 3-207. Exclusiveness of procedure. The method provided in this Act of perfecting and giving notice of security interests subject to this Act is exclusive. Security interests subject to this Act are hereby exempted from the provisions of law which otherwise require or relate to the recording or filing of instruments creating or evidencing security interests in vehicles including chattel mortgages and conditional sale agreements, provided, however, that with respect to a manufactured home that is or will be affixed to a permanent foundation, upon recordation of an affidavit of affixation pursuant to the Conveyance and Encumbrance of Manufactured Homes as Real Property and Severance Act and satisfaction of the requirements of Section 3-116.1 or 3-116.2, as applicable, any perfection or termination of a security interest with respect to such permanently affixed property shall be governed by the laws applicable to real property.
(Source: P.A. 98-749, eff. 7-16-14.)

625 ILCS 5/3-208

    (625 ILCS 5/3-208) (from Ch. 95 1/2, par. 3-208)
    Sec. 3-208. Suspension or revocation of certificates.
    (a) The Secretary of State may suspend or revoke a certificate of title, upon notice and reasonable opportunity to be heard in accordance with Section 2-118, when authorized by any other provision of law or if he finds:
        1. The certificate of title was fraudulently
    
procured or erroneously issued, or
        2. The vehicle has been scrapped, dismantled or
    
destroyed.
    Except as provided in Section 3-116.2, the Secretary of State shall not suspend or revoke a certificate of title to a manufactured home by reason of the fact that, at any time, it shall have become affixed in any manner to real property.
    (b) Suspension or revocation of a certificate of title does not, in itself, affect the validity of a security interest noted on it.
    (c) When the Secretary of State suspends or revokes a certificate of title, the owner or person in possession of it shall, immediately upon receiving notice of the suspension or revocation, mail or deliver the certificate to the Secretary of State.
    (d) The Secretary of State may seize and impound any certificate of title which has been suspended or revoked.
(Source: P.A. 98-749, eff. 7-16-14.)

625 ILCS 5/3-209

    (625 ILCS 5/3-209) (from Ch. 95 1/2, par. 3-209)
    Sec. 3-209. Powers of Secretary of State.
    (a) The Secretary of State shall prescribe and provide suitable forms of applications, certificates of title, notices of security interests, and all other notices and forms necessary to carry out the provisions of this chapter.
    (b) The Secretary of State may:
    1. Make necessary investigations to procure information required to carry out the provisions of this Act;
    2. Assign a new identifying number to a vehicle if it has none, or its identifying number is destroyed or obliterated, or its motor is changed, and shall either issue a new certificate of title showing the new identifying number or make an appropriate endorsement on the original certificate.
(Source: P.A. 76-1586.)

625 ILCS 5/3-210

    (625 ILCS 5/3-210) (from Ch. 95 1/2, par. 3-210)
    Sec. 3-210. Court review. A person aggrieved by an act or omission to act of the Secretary of State under this Article is also entitled to a review thereof by the Circuit Court of Sangamon County in accordance with the Administrative Review Law, as amended.
(Source: P.A. 82-783.)