I bet you are going to say, "Syxguns, I did all that but it's not working!"
Well that's because of a couple of different things that I have not discussed yet!

Don't worry we are almost finished.
The changes that you made the the usergroups should be automatic after you Update User Title and Ranks. Be sure to double check after you add a secondary usergroup to the user you are giving rank to. Make sure that before you do this the first time that you have all user titles and ranks ready to go in the AdminCP then follow these steps:
AdminCP > Maintenance > General Update Tools and select Update User Titles and Ranks
Now for a quick example on how to really make this work if you are using multiple user titles. Yeah, I'm going into another quick lesson!! OMG
There are two things that you don't have to do, but I suggest that you do if you are running a forum based off a particular topic, and not just a standard forum. The first thing is to add questions into the registration process, and the second thing is to have e-mails sent to moderators to have them check the user after they register. I guess I should have said three things. You also need a hidden forum for moderators to relay information to you. I would suggest setting up the first topic as new member registration information. Then after the Mod checks the user profile they can relay the information to you in that thread.
1) First thing is first. Set up the forum, and I shouldn't have to explain that to you, but if you do need help, just ask.
2) We are going to set up some questions in the registration area for the new members.
Go to AdminCP -> User Profile Fields -> Add New User Profile Field
Add as many as you like, they do not have to be shown at registration.
Adding User Profile Fields Manual
3) Now the next thing to do is to have new registrations moderated, this is where they report to the new thread you created for Moderators.
AdminCP > Settings > Options > User Registration Options
You will see, "Email Address to notify about new registration" and I believe you can list multiple e-mails here
Moderators can then inform you in the thread about the options selected by the user, for you to update their ranks.
4) Yes, the last and final thing!!
Because you have a primary usergroup that the members are in you may also apply secondary usergroups to this are. For example, in my case a new member may be a Musician, and I would be happy to display that logo for them, but I do not want to advance them to Musician as a primary usergroup. So how do I go about it?
I have these Primary usergroups available to members
New Member: Must have 3 posts before they become a Registered User
Member: they are here in the Registered user group until they reach a high number of posts or I decide to advance them. I set it up that way so that not just anyone could get into the VIP, and it would take years of posting before they did.
VIP: need 1000 posts or I place you there hidden forum
Musician: Same as VIP.
So I have a new member that is a Musician. I do not want to give them the primary title of Musician because of the hidden forum, until they have posted enough threads, or proven themselves. So here is what I do:
AdminCP > Users > Search for User and it will open up in the AdminCP for me to make changes. Here I am going to attach a pic for you to look at, so let me give you a quick explanation:
User is a Registered Member but they are also a Musician. I do not want to move them into the primary Usergroup (listed in the drop down box in the pic) Musician that I have, but I want to display the Usergroup Rank "Musician". So in the check boxes listed below the primary usergroup I have all of my secondary usergroups. The first thing that you have to do is create a new usergroup tag for Musician that is maybe a different color. You would name it "Music_2" or something like that. That is the User tag that you would want to use.
Why you might ask? Well, the default User Tag that I have for Musician is tied to the Usergroup Musician and they will see the hidden forum with the secondary tag. I just realized this as I was typing this up and changing the secondary usergroup. So remember that if you are not wanting to advance the user permissions.
And that's it! A lot of steps to follow through with, but once you are finished it is very easy to maintain.