What can I do if the seller is keeping the car title from me?

I recently bought a car from a guy online. He is the owner of a mechanic shop. I paid him $2,000 up front. Then the remaining $300 a month later to pay the car off. He was supposed to mail me my title to the car then, he had given me a paper dealer tag. Two days after I paid the car off, the car would not run. I called him and asked him what could be wrong, since he sold me on how 'mechanically sound' the car was. He looked at the car at his shop and discovered the fuel pump had gone out. He fixed it for $400 and set up a payment plan with me, as I did not have the $400. I paid $150 up front, set to pay another $100 Jan 15th, and the balance Feb 15th. He has not mailed me my title to the car. He refuses, has told me he is going to keep it until the balance for the fuel pump is paid off. And has told me he will not send me a renewed dealer tag for the car (it is now expired) until the balance is paid off. This is not legal is it? I had paid the full amount for the car, so it was mine. He has no right to keep the title correct?