What to do about former step dad coming in my wife and I house.?

My wife and I are 27 years old. Her mom married this guy named Shawn thirteen years ago-they divorced three years later (ten yrs ago). Shawn is in the National Guard and he is crazy about my mother-in-law. He goes to training facilities for a couple of months at a time, we get a lot of peace then. Basically before my wife and I got married (2 years ago) she had car troubles and I went and financed a new car for her through a family dealership (no relation to Shawn). In between moving and jobs we weren't able to pay a payment on time and Shawn went up there and paid the $1400.00 remaining on the car and now he has the title. Keep in mind we weren't late, up for repo, and we had already paid $2600.00 on it. Can they just hand our money over to a stranger like that (by giving him the title). Now were getting to the problem, he has that title. He also paid a several hundred dollar doctor bill for my wife. We now both have jobs and are making good money. Every since he did this for her, he has been coming over three, four times a day-being weird. Telling her to look at his "pretty six pack" that he SO doesn't have. Keep in mind my wife is helping me type this-these feeling are mutual among us. Also he tells her she can't go with me to certain places because she's got to spend time with him. He will steal my seat when I go to the bathroom to sit by her. When he does if she manages to scoot away from him he will rattle paper at her and whisper "Come sit by me!" -WeirD?!? The other day he said we could go to this park and children get a discount, he told me and my wife that we should all dress me up like a baby, then he told me to do my baby voice/impression-Like anyone else I told him "Na I'm good.." and my wife and I didn't even laugh but he felt as though that was hilarious. He put a sticker on one of our vehicles (an NCAA college sticker) and she told him that she wanted to take it off, it didn't matter that it was a rival school to us (but his alumni) but she wanted it off-he said, "You can leave it on there and think about me every time you look in the mirror. And kept saying it so I said, well Shawn it isn't about the school or remembering anything, she just wants the car back "factory" or natural. He would not drop it he just kept on, so finally she and I were tired of hearing it and we decided to just agree. He sneaks a look at me in his rear view mirror (I was in the back seat) and he cut his eyes and me, then raised his eyebrows up and down-you know like "Ha Ha See THere!" Like a child, Like he wanted to stick his tongue out. I ignored it that day though. He talks high pitch and no b, it sounds just like a woman. My mother in law divorced him for being not manly at all and watching her bathe and use the bathroom, and plainly being nosey. Yesterday made the second time in three days he asked my wife who she was texting-I don't even do that (unless Im expecting a text from someone on her phone, she is the same way) But he holds all of this over us and he's like " YOU GOTTA BE NICE, or YOU CAN'T GO ANYWHERE TODAY YOU GOTTA SPEND TIME WITH ME" He never thinks that we are Married Adults and we may be being intimate. When we are together and taking a nap, she will tell him, "I WILL TALK TO YOU WHEN I GET UP" and he comes over/calls anyway, and disregards the nap. He knocks with no breaks, just a rapid-"KNOCK KNOCK KNOCK KNOCK KNOCK ctd ctd ctd ctd" until we answer! He has called her a ***** before, if he doesn't get his way he sulks and leaves.. Biggest of all, my wife vaguely remembers him coming in her room that time her mom and him were together (3 small years) he came in my wife's rooms who was only 13 at the time, and but his hand on her back, and began to leave the room and grazed her womanhood below. Keep in mind my mother-in-law said the weirdest thing of all was how he would stand there as she would bathe or use the bathroom, just gazing. Weird. But he isn't respecting us as ADULTS who are MARRIED in our own PAID OFF HOUSE (my deceased father left me) I don't know if he is jealous, obsessed, or what. If he didn't have that title-WHICH HE SHOULDN'T have I would tell him off but my wife is scared because he has that title with 2400 $ of our vehicle equity and she is afraid of what may happen. What would you guys suggest doing without pissing him off and still getting our stuff.. We can pay him in a few weeks, we both just got new jobs paying good, haven't got paid yet though. But thanks for any help, will give best answer for any help. Thanks..