I don't know if I disagree with my friend Don N. or not. Here in Texas it can take up to 4 weeks before we actually see the title to the car. I am not a consumer lender, but the order of activity occurs something close to this:

customer applies for a car loan, and the seller (if a dealer) drafts us for the sales price. We receive from either the seller or the dealer the infamous "White Slip". This white slip is the tax receipt from the local tax office that the title has been applied for and the taxes paid. It has all the same info on it that the title has. so we check the white slip against the info provided.

Comment #1--I suspect that whether a lender inspects the vehicle, the title, etc. has alot to do with the local market and whether or not there is an existing relationship with the borrower. For example, it would not be uncommon at all for a lender to rely on the word of a customer to whom he had made prior loans, especially in a small town where practically everyone knows everyone and the banks know all the auto dealers.

Comment #2--"In good faith" from previous post; the loan officer relied on you "in good faith", you relied on the loan officer and the seller "in good faith", the seller did not act "in good faith". Unfortunately, you and the lender were both taken advantage of, your action should be against the person that attempted to sell you the car. I recommend that you work with your bank to resolve this.

Good luck.