NJ is similar but so long as there's an existing title in NJ or any surrounding states that they check, you simply can't get a title. I've had a judge tell me its not the responsibility of the state to provide proof of ownership, it falls with the selling owner.
He reminded everyone that it is illegal in this state to transfer ownership of any motor vehicle without a title or legal proof of ownership, and that its illegal to possess a vehicle without such proof of ownership. You can't buy it, you can't own it, and you can't register it.
I do know they put out a notice stating that they won't accept registrations from out of state provided by any of the 'known' title agencies who advertise they can get you a title. So far I've not seen Vermont mentioned, or any other state other than NV so far. I was behind a guy in line a few years ago who had gotten a title for a boat that way, he bought a boat hull and built a boat from it, it had no papers and no history, yet NJ wouldn't issue a title. Years ago they would simply do a state police inspection and title search and if nothing turned up, they would issue you a new vin number but that stopped about 15 years ago.
I even had trouble transferring a boat I bought myself from PA to NJ. The boat was older, I had bought it new in PA years ago when I lived there and when I brought it to NJ, NJ had a new computer system that refused to recognize the old 6 digit hull number. It took me three years to get that boat registered here, and I had the original bill of sale from the dealer, the Certificate of origin, and the PA registration for the boat. NJ wanted a title with 17 digits for the hull number or nothing. I finally found a woman who realized how ridiculous the whole thing was and she simply issued me a new hull ID number and a decal with the new number to put beneath the old one and charged me $15 for the process. (That was after two years of numerous trips to the marine police, state police headquarters, the state capital, and five different DMV offices, and four trips back to PA where I bought the boat and two to the PA fish and Game office where I registered it at in PA. (Luckily PA kept renewing the registration there with my NJ address while all this went on). To make matters worse, I moved back to PA for a few years for work in the 90's, and had to register the same boat in PA again, after I had gotten a NJ title for it, and PA refused to recognize the NJ title and registration because it had an 'altered' hull number their computers didn't recognize. PA also refused to transfer my homemade NJ registration to PA saying that NJ trailer reg. isn't in compliance with PA law.
I gave up and left it registered and tagged in NJ at a PO box for 8 years and dealt with the home owners association there complaining about the NJ registered boat in my driveway. I finally made up a temporary fake PA boat number with my old PA boat number on it to tape over the NJ numbers to shut them up.