Posted February 5, 2014 by & filed under Auto Insurance, Border Crossing, Driving to Mexico, Mexpro.com.

Permission Letters for Vehicles Being Driven into Mexico

Financed Vehicles

Lien Holder

People quite often will borrow money from lending institutions or from individuals when they purchase motor vehicles. If you have ever taken out a loan to buy a car, truck, van, SUV, motorcycle, motorhome, travel trailer, or other type of vehicle, then there was also a lien placed against that vehicle. When a lien is placed on a vehicle, the lien holder maintains a legal financial interest in that vehicle, until the loan is paid off. Once a loan is paid off, the title for the vehicle is then transferred, removing the lienholder information.

Loss Payee

When talking about insurance, the lien holder is quite often referred to as the loss payee. In the event of a loss, if an insurance policy has a loss payee (lien holder) listed, then they would receive the payment after a loss, instead of the named insured beneficiary of the policy. The named insured would only receive what is left over, after the remainder of the loan balance is fully paid.

“Why do I need permission to take my financed vehicle into Mexico?”

If there is still a lien holder listed on the title for your vehicle, then the lender also maintains some financial interest in the vehicle. This applies, even if you only have just one payment left. Because of the financial involvement in the ownership of the vehicle, the lender also has a say in whether or not you may legally take the financed vehicle outside of the country.

Getting a Letter of Permission from the Lender

To get permission from the lender, they will want you to demonstrate that you have already secured proper insurance coverage for the vehicle. Most lenders will simply ask you to fax a copy of the Mexican insurance policy, that you have already purchased, showing coverage for the entire period of time, that the vehicle will be inside Mexico. Lenders often set their own minimum acceptable limit of Mexican liability coverage. They also require a policy that includes coverage for both physical damage and theft, as well as that these coverage items both have fixed deductibles. Finally, lien holders usually will not accept a policy that has a limit of insurance, that is less than what is owed for the vehicle. So, if you owe more for your vehicle, than it is actually worth, you may have to purchase a more expensive policy, just to satisfy the lenders requirements.

Borrowing Someone Else’s Vehicle

Driving a Friend or Family Members Car

It is actually pretty common for people to sometimes borrow a friend, or family members car to drive into Mexico. In the U.S., simply giving someone verbal permission to drive a vehicle is quite often all that is needed. However, if you are driving a borrowed vehicle into Mexico, then you’ll have to abide by the rules of the Mexican government.

Rental Vehicles

If you should decide to rent a vehicle to drive into Mexico, instead of taking your own, you will first need to be sure the rental agency will allow their vehicle to go outside the country. If they do allow it, then you will also need them to provide you with a letter of permission stating so.

Work Vehicles

If you are planning to take a company car or a work truck across the border into Mexico, then you will also need to carry a letter of permission from the vehicle owner.

Asked to Show Vehicle Documentation

In Mexico, if you are ever detained by the authorities while driving, just like the police often do in the U.S., they will very likely ask to see your Drivers License, Vehicle Registration, and Proof of Insurance. One of the things that they are checking for as they review your vehicle documents, is whether or not the vehicle is in the possession of the actual owner who is listed on the vehicle registration.

Illegal Without Written Permission

Driving someone else’s car without their permission is illegal in Mexico, and as you might have already guessed, the Mexican authorities do not typically accept ones word about having permission, but instead want to see something in writing. Getting a letter of permission from the vehicle owner, before driving the vehicle into Mexico, is the smart thing to do.

Vehicles Can be Confiscated Without Letters of Permission

If you are in an accident, get pulled over for a traffic violation, or simply asked to show your vehicles documentation, and the authorities find you are not the owner of the vehicle, and you don’t have a permission letter, they could potentially confiscate the vehicle and place it in a Mexican impound, as if it had been stolen.

“What should my letter of permission say?”

There are just a few simple questions that the letter of permission needs to answer: Who owns the vehicle?; Who is borrowing the vehicle?; What dates will the vehicle be in Mexico? The letter of permission will also require the signature of the vehicle owner. Additionally, it is recommended that letters of permission be notarized, and include a raised or embossed seal of the notary. The more official your letter of permission appears to the Mexican authorities, the less likely you are to be hassled or detained.

Example of a Permission Letter

To whom it may concern,

I, (name of the vehicle owner as listed on vehicle registration or title), give permission to (name of person, as listed on drivers license, who is borrowing the vehicle), to operate my vehicle in Mexico from (date vehicle is entering Mexico) through (date that vehicle will be returning from Mexico).

(Owners Name)
(Owners Signature)
 

Be sure to keep the letter of permission with you at all times while driving in Mexico, along with the rest of the vehicle’s important documents, including your Mexico Tourist Auto Insurance policy.

>Mexpro.com allows you to get comparative quotes for insurance from “A rated” carriers. If you have other questions, you can call to speak directly with a Mexico Insurance Specialist Agent at 888-467-4639.

2 Responses to “Mexico Vehicle Permission Letters”

  1. soledad

    I got insurance for the financed vehicle under the person that is financing it (this person will not be the driver). Does the actual person driving the car need to be insured as well?

    Reply
    • Mike Mercer

      The Vehicle Owner Information on an auto insurance policy should always match the name listed as the owner on the vehicle’s title paperwork. The fist, middle and last name information should be identical to the owner name shown on the vehicle registration. The finance company or lender information also needs to be included on a policy, but their name, address, and your account number information, should instead be listed under the Lienholder Information section of the policy. So, the vehicle owner is by default also the named insured, while the lender will require that their information be listed as the lienholder (a.k.a. loss payee). Our Mexico tourist auto insurance policies automatically cover other drivers, and we also provide an option to list up to 3 additional driver names (besides the owner) on your policy. Otherwise, check that all of your drivers have a valid non-Mexico drivers license, and if the owner will not be inside the vehicle, be sure to carry a permission letter.

      Reply

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