Why would a financial institution want a power of attorney for an auto loan instead of just a lein hold?

I am attempting to refinance a 2006 model auto with a different institution for a lower interest rate however, this institution wants a power of attorney over the vehicle. I've had hundreds of auto loans and have NEVER given a POA to the lending institution - so why now?

Why would a financial institution want a power of attorney for an auto loan instead of just a lein hold?
The POA will allow the lender to title the vehicle and execute all other documents necessary for transferring the loan from your current lender to themselves. It is actually saving you the trouble of personally signing all the documents.





It would also need this in the event that you default on the loan. Holding the lien is not enough - that only means they are owed money on the car.





This is a very common practice and should not worry you, assuming you have read the POA and it is limited in scope (to matters relating to the vehicle in question).
Reply:The POA is helpful when paperwork is not completed or incorrectly completed. If we have a POA we can fixed the paperwork without inconveniencing the customer. This also helps if theres two parties on the loan and one them are not be corporative. Which causes the title work to be held up. With the POA we can sign off for the customer and have it completed.....
Reply:I think it is to make the title transfer process easier. Usually it is a temporary POA.