How to Search For the Best Title Loans Online

If you are considering taking out a car title loan to help ease some financial burden, you might be wondering how you can best search for car title loans online. It can be a tricky process and can be filled with uncertainty regarding how to find the best lender in your region or state.

Luckily, there are some clear ways to search for car title loans online that will not only help you find the best deals, but will also help you find the best companies that you most would want to work with.

It’s actually quite easy.

Search for companies that have been in business for years, even decades.

If you find a car title lender that has just opened for business, you will probably want to steer clear. A brand-new business can either mean that they have no idea what they’re doing when it comes to car title loans, or that they are a predatory company disguised as a car title lender. On the other hand, if you find a company that has been running for years, chances are good that they are responsible, respectful, and know the ins and outs of the car title lending business. If you’re new to car title loans, there is no better lender to have than one that has seen all types of borrowers throughout the years. The only way to guarantee that they have that kind of experience is to find a lender that has been doing it for quite some time.

Search for their interest rates.

The interest rate is a percentage number and it basically decides how much you are paying to take out the loan. If your interest rate is 10 percent, you will have to pay back the entire value of your loan, plus ten percent, in order to pay your loan off in full. Car title loans typically come with pretty high interest rates, but that does not mean that there isn’t variety within the market. Try to find a car title loan that offers a reasonable interest rate, that way you won’t be paying hand over foot just to take out your loan.

Ask about hidden fees.

If a car title lender is really interested in treating its customers fairly, they will be wholly upfront about any added fess you may accrue during the life of your loan. Simply ask. If they seem upfront about things, chances are good you’ll be treated fairly. If they skirt the question and seem like they have something to hide, you may want to consider looking elsewhere.

Finally, one thing to make sure you search for is customer testimonials.

That means reviews from past customers who write about their experience with a given car title lender. The best lending companies will likely have testimonials available right on their website. If they don’t, reviews and testimonials should be easy to find on any number of company review sites. If you find yourself having a hard time finding testimonials whatsoever, chances are good you are looking at a company that does not put the customer first. Best to steer clear of companies like that.

The Pros and Cons of Car Title Loans

If you find yourself strapped for cash and in need of some serious financial help, you might be wondering what your options are. Surely, you are considering seeking out a personal loan, but it you are one of the many Americans with bad credit, you will likely find yourself have a very are – or even impossible – time securing a traditional personal loan.

Your options might be limited if you’ve got a credit score on the lower side, but one type of loan that is available to you no matter your credit score is a car title loan. That is, as long as you have a car. As long as you have equity in your car, and your car’s title is lien-free, you can use it as collateral in being approved for a car title loan.

While they are fairly straightforward – and are meant to be easy to get – car title loans definitely come with their pros and cons. Before we break down the pros and cons of this type of personal loan, let’s get into the nitty gritty of what they are and how they work.

How do they work?

Before we go into the pros and cons, we should go into detail regarding what a car title loan really is, and how it operates.

 In every car title loan, the lender will first evaluate the value of your car and then offer you a loan based on what your car is worth. That is not only dictated by the make, model, and mileage of the car, but also on how much equity you have in your car. If you own the car outright, you will get a more valuable loan than if you still owe money on it.

Car title loan companies will also require you to provide a proof of income, but that does not mean you have to necessarily be working. You can offer proof of social security, worker’s comp, retirement, or more as a proof of income. Beyond that, you won’t have to have your credit score evaluated.

Now that your car’s value has been determined, the lender will offer you a loan in exchange for holding onto your cars title. Do not expect to get a loan worth the full value of your car, though. Typically, car title loans will be worth anywhere between 25 percent and 50 percent of your car’s total value.

Once you take out your loan, your lender will hold onto your car’s title until the loan is repaid. One of the primary selling points of car title loans is that you can still operate your car while the lender has your title. That all changes if you default on your payments, however. Some lenders even require that you install a GPS tracking device on your car when you get your loan so that the lender can locate your car in the event of a default.

It is important to keep in mind that car title loans are typically short-term loans (repayment periods can last just a month) with incredibly high interest rates (annual percentage rates regularly reach 300%). Worse than that, if you find yourself not being able to repay the loan within the specific repayment period, the lender will repossess your car as collateral.

Now that you’ve got a better idea of how car title loans actually work, you might be getting a better answer as to whether or not they are right for you. If you are in a momentary financial pinch – that you can comfortably say will come to an end soon – this kind of loan could be helpful. You can get the money you need now, and safely pay it back within the repayment period.

On the other hand, If you are in and out of work and constantly find yourself in tough financial situations, a car title loan is a quick and easy way to lose your car. That would leave you not only in debt – because you can still owe even if your car is repossessed – and without a car.

What are the pros?

Now that all of that is covered, let’s go over the pros of car title loans.

  • One pro is that basically anyone with car can qualify. Because you are using your car as collateral, you can qualify regardless of your credit score or financial situation.
  • Another pro is that you can get the cash you need quickly. The application proves is fast for most lenders, and in most cases, you will have cash in hand within 24 hours of your approval. In some cases, you can even have your cash in hand with an hour. The amount you can apply for is based on the value of your car. Most loans range between $100 and $10,000.
  • Another pro of car title loans is that you can still use your car even though your lender is in possession of the car’s title. If you are responsible with your loan and are able to make the payments, it can feel like you are actually getting paid to drive your own car. Of course, this can change very quickly if you are unable to make a payment on your car title loan. If you default on your loan, you will most likely lose your car. While you do have some legal options in terms of keeping your car or buying it back, it is definitely not an ideal situation for anyone.
  • One final pro of car title loans is that, unlike many personal loans that exist on the market, simply taking out a car title loan will have no negative impact on your credit. It can actually have a positive impact on your credit if your lender reports to the major credit report bureaus. One way that a car title loan can have a negative impact on your credit, however, is if you default on the loan. If you miss a payment, your credit score will almost certainly take a hit just like it would if you missed on any other kind of payment on a loan. Considering the fact that your car has been put up as collateral in the event of a missed payment though, a dip in your credit score will probably be the last of your worries.

What are the cons?

So, the pros of car title loans have been established, but if you want to be a fully responsible borrower, you’re going to have to know about the cons of car title loans as well.

  • One con of car title loans is they often offer very high interest rates and fees. Depending on what part of the country you live in and which lender you decide to work with, you could very well end up paying as much in interest and added fees as you would with any payday loan. In order to get the most out of your car tile loan, you’re going to want to do some significant shipping around to try to find the lowest interest rate possible. When you are choosing a lender, make sure you understand everything about it, all the terms, the interest rate, any added fees, and more. Feel free to ask the company to explain each paragraph of the loan. If you find yourself having a hard time understanding all of the terms, or getting the lender to explain them, don’t be afraid to turn around and walk away.
  • Another obvious con of car title loans is that you could end up losing your car as a result of taking out the loan. If you default on your loan, the lender has the right to repossess your car. In fact, according to a study by the Consumer Financial Protection Bureau, one in five car title loan borrowers will end up losing their car as a result of taking out the loan. Because the amount of the auto title loan isn’t worth the full value of the car, the lender can usually get more for the car than they would have if you had paid the loan back in full. If you are in a financial pinch, it can be easy to overlook this very real risk. That would be wholly unwise. Only take out a car title loan if you are certain that you can pay if off within the repayment term that your lender offers you.
  • The final, and perhaps most impactful, con of car title loans is that even if you end up losing your car to repossession, that might not be the end of it all. If you default on your loan and your lender doesn’t end up getting enough money in the sale to pay off the entirety of your balance, you will find yourself still being on the hook for whatever is left. This would mean that you’d literally be paying the company that just took your car because you weren’t able to pay off the loan in the first place. While this usually doesn’t happen because the value of the loan is lower than value of the car, but it can happen if the initial estimate was off.

So, are they as bad as they seem?

Now that you know the basics, the pros, and the cons of car title loans, you might be getting a better idea regarding whether or not they really as bad as they seem. It might seem like an easy out if you’re in a financial pinch, but if the cons are any indication – and they should be – you should really consider a car title loan as a last result. Make sure to try to exhaust all your other options first.

As with most borrowing situations – both in terms of secured and unsecured loans – you should really take the time consider whether or not you really need the money. Only you can decide what is truly essential and what can wait until your next paycheck. If you end up deciding that you really do need the money that you can get from a car title loan, it is probably time to start looking for the best deals and best lenders in your area.

How to Get a Car Title Loan Without a Job

Financially tough times call for drastic measures and sometimes that can mean taking out a loan.

Going through a traditional personal loan lender can be tough, especially if you dong great credit, are under employed or simply are unemployed while looking for work. You can spend quite a bit of time applying and getting rejected by unsecured loan lenders.

Instead of jumping through the many hoops that most traditional lenders require of you, you could very easily opt for a car title loan instead.

Car title loans are a great option for people who need money fast, but don’t have good credit, solid employment, or even a bank account.

The reason why is because car title loans are actually secured loans that are tied to the value of your car.

Before we go into how you can secure a car title loan without a job, let’s break down how they work.

Basically, a car title loan is a secured loan that is based on the value of the car that you own in full.  After you apply for a title loan (you can apply online, on the phone ,or in person), the lender will evaluate the value of your car and then offers you a loan based on it. Depending on the company that you apply for a loan with, they may ask for proof that you will be able to pay back the loan within the payment term, but overall car title loans are known for being incredibly flexible when it comes to credit score checks.

Once your vehicle’s value has been determined, the lender will offer you a loan in exchange for holding onto your car’s title. Typically, car title loans range in value between $100 and $5,500. They can go much higher, however. If your car is especially valuable, title loans are sometimes known to go as high as their legal limit – which in many states is $50,000.  

During the loan, your lender will hold onto your car’s title until the loan is repaid. One of the primary selling points of car title loans is that you can still operate your car while the lender has your title. If you default on your payments, however, your lender will have the option to repossess your car.

Once you are approved for your loan, you will get the cash you were approved for quite fast, typically within 24 hours of approval., Make sure not to enjoy it for too long though because you’re going to have to start paying back your loan soon.

Car title loans are typically short-term loans (repayment periods can last just a month) with incredibly high interest rates (APR up to 300%). If you find yourself not being able to repay the loan within the specific repayment period, you will not only be subject to accruing added interest fees, you will also be at risk of losing your car.  

Now that we have the basics of what a car title loan is, we can move on breaking down why they are a good option for you if you are unemployed.

If you own your car and have proof of ownership, you can use it to secure a car title loan. While some loans can take a long time to be approved, car title loans can often take as little as a few hours to be approved. Because the value of the loan you get is tied to your car, you are not required to have a cosigner or have your credit report checked out.

The real question is, how do you get a loan without a job?

The good news is that you can definitely get a car title loan even if you are unemployed. While some lenders do require proof of income, others only require that you own your car. All car title lenders will require proof that you do in fact own the car.

While proof of income is not required, you will have to be prepared to share some information in order to qualify for a loan. While there are very few requirements, it is best to make sure that you qualify and have the documents necessary to be approved.

  • You must be at least 18 years old.
  • You must be able to provide a copy of a valid government issued ID.
  • There must be no liens on the vehicle, meaning a bank or auto loan institution does not own your car.
  • You must own the vehicle outright.
  • You must have the original title of the vehicle.

For most car title loans, repayment terms last just 30 days. You don’t need to prove that you have a job, but you will have to prove that you’ll have the money to pay back the loan. Luckily, a large variety of different sources of income can prove to be enough for you to secure a car title loan.

Here are the other forms of income you can use to secure a title loan without being employed:

  • Under the table payments: For this, you are going to have to prove that you do get paid under the table. Many lenders will accept a letter from your employer as proof of under the table employment which includes your name, the date, the amount you are paid, the service you provide, a signature and a contact number.
  • Social security benefits: To prove this, just share your pension plan statement. All you need to do is fax a copy or take a picture of your document and send it to your lender.
  • Annuity: To prove that you have an annuity, just take a picture of your statement and send it to your lender.
  • Worker’s compensation: To prove that you are getting money through this form of insurance, just show the necessary documents related to the amount of money you receive from worker’s comp.
  • Settlement/court-ordered reward: If you received money during a court settlement, this will be enough for you to obtain most car title loans.
  • Inheritance: If you are lucky enough to have an inheritance, you can use it to prove that you will be able to pay back your car title loan.

Sharing documents such as these may seem like a hassle, but really it is for your own benefit.

Even if you do have a car that can be used to get a car title loan, you need to make sure that you will actually be able to pay back your loan once you are approved. If you are unable to pay back your loan, not only will you most likely lose your car to repossession, you could also find yourself indebted to your lender if they cannot sell your car for the full amount of what you owe.

Are Car Title Loans a Good Idea?

If you are facing a financial emergency and do not have the credit score to qualify for a traditional personal loan, you may be wondering what your options are.

As you may already know, one option for people no matter their credit score is a car title loan, as long as you own your car and have a lien-free title. But what are car title loans, and are they a good idea? Keep reading to find out.

Basically, a car title loan is just like any secured loan, which means that the value of your loan is tied to the value of something you are using as collateral. In this case, it is the value of your car.

To get a car title loan, you have to apply either online or in person at a store, offer proof of your car, your title, your income, and several other documents in order to qualify. It is very quick and very easy. In fact, many applicants can get their loan approved and have their cash in hand within an hour of applying. Once you take out your loan, you will have a set amount of time – known as a payment term – to pay back your loan and all the other costs that come with it such as your interest rate and any addition fees.

Car title loans can either be a real financial blessing, or a real financial burden.

It all depends on you.

Some questions if you are wondering whether or not a car title loan is a good idea.

  • What will I use my loan for?If you have come across an unexpected financial emergency, such as a medical emergency, and you have no other way to make necessary payments, a car title loan could be a good way to help ease the burden. Similarly, if you run a small business and have an opportunity to make one large payment on something that will reap financial benefits down the line, a car title loan could help you make that purchase. If, on the other hand, you are considering a car title loan just to make some indulgent purchases that you want, but do not need, you should probably look elsewhere for the money.
  • Will you be able to afford the interest rates? This is a question you should ask when you are considering taking out any kind of loan. Interest rates attached to loans can get really expensive, especially if you have trouble paying on time.
  • Take a look at your finances, and take a look at the interest rates offered to you to get a better idea of whether or not you will actually be able to pay off your loan.
  • Can you survive without your car? Because car title loans are secured loans borrowed against the value of your car, that means that if you default on your loan, you run the risk of getting your car repossessed. In fact, approximately 20 percent of people who take out car title loans end up getting their cars repossessed.  So, before you take out a loan, you have to weigh the ultimate risk. If you know that you simply could not survive without your car, you probably want to hold off on taking out a car title loan.

Now that you have answered these questions, chances are good you have a much better idea about whether or not online car title loans are for you.

If you have decided that you want to take out a car title loan, here are some specific things to look out for when you are doing your initial search.

Interest Rates

As previously mentioned, interest rates attached to your title loan have a huge impact on the overall cost of your loan. Interest rates for title loans can be as high as 25 percent so looking for anything lower than that should be a priority.

The reason why is because interest rates basically equal the amount of money you will have to pay on your loan to take it out. So, if you get a 25 percent loan, that means that a title loan worth $2,000 will require an interest payment equal t0 $500 to pay your loan back in full!

It can be quite the financial burden, so the lower the better.

Flexible Terms

Another aspect of your title loan to keep an eye on is whether or not the lender you are thinking of borrowing from is willing to offer a flexible payment term. As a rule, car title loans are typically short-term loans with terms as short as a couple weeks to a month. That can be great if you are going to have the money you need in a short amount of time, but if you don’t think you will, you are going to need a title loan that comes with either a longer payment term, or multiple terms.

A title loan with multiple terms means that you will be responsible for multiple payments, so a low interest rate is even more important, because you will be paying it several times.

Positive Customer Testimonials

This is the final aspect of a potential title loan to look out for. Title loans can be tricky to navigate and it is important to have a responsible and respectable lender that you are working with.

Check out the company that you are interested in working with by searching the company’s name. If they have great customer testimonials either on their site or on a third-party business review site, you should feel confident in your ability to borrow.

Short-Term Lending: Their Benefits and Risks

When you think of types of loans, your mind may naturally go to types of loans that are meant to help people buy a house, start a business, or make another kind of huge purchase. These loans typically take years to pay back. That isn’t the only type of loan available to you, however. In fact, there are a ton of loans that are meant primarily to act as a stop-gap or bridge loan to help you or your small business make ends meet until additional resources become available.

If you are able to use your short-term loan responsibly, they can be incredibly useful. They can help you make a necessary purchase or deal with a financial emergency. They can also be used to improve your credit score if you borrow and pay back your loan responsibly. Before we go over the benefits and risks of short-term loans, however, let’s go over several types of short-term loans exist.

Short-term loans from an online lender

If you are looking to take out an unsecured lender, why not take advantage of the digital age to help you get the financing you need. These loans can be available to you in as little as 24 hours. They function much like a traditional loan, but instead of payments being stretched out over weeks, months, or years, they can be due in days.

Typically, you can get a short-term loan from $2,500 to $250,000. Terms can range from a number of weeks to approximately 18 months. In order to qualify, you are going to have to have a strong credit history. If you qualify, you can expect to have an interest rate starting at about 10 percent. Compared to other kinds of short-term loans, a 10 percent interest rate is actually quite low.

Payday loan

A payday loan is a very short-term loan that typically lasts no more than a few weeks. While payday lenders have generally operated out of storefronts, some payday loans are now operating online as well. Payday loans work best for people who need cash quick. The reason why it’s best for people who need cash fast is because the entire application process can be completed in a matter of minutes.

In order to qualify, payday lenders will verify your income and a bank checking account. They verify the income to determine your ability to repay. But the bank account has a more specific purpose.

When your loan is approved, the funds are deposited into the verified bank account. And then, the lender will require that you write a postdated check in payment of both the loan amount and the interest you have accrued during the life of the loan.

If you cannot afford to make your payment by the time your term has ended, you can typically roll over your loan, but that will lead to additional interest which can make it even harder to pay it back in the future.

Car Title Loans

If you are looking for a short-term personal loan, but do not have the credit score necessary to qualify for a personal loan. Car title loans can be a great option. The way that they are made available to people with sub-prime credit scores is thanks to the fact that they are secured loans attached to the value of your car. These loans typically range from $100 to $10,000, though the loan amount can go much higher based on the value of your car and the equity you have in it.

The payment terms of these loans can last just days, but the most common term for car-title loans is one month. These types of loans are meant to help you make ends meet during a period of financial insecurity. Keep in mind that interest rates for car title loans are quite high so you certainly want to pay them off as quickly as possible as to not accrue huge amounts of interest expenses.

Benefits and Risks

So now that we have covered several types of short-term loans, let’s go over the benefits and risks of short-term loans.

The major benefits of short-term loans include fast distribution of funds, easy access, and extensive availability across the country. For short term loans such as car title loans and pawn shop loans, little to no credit score checks or background checks are necessary. While unsecured personal loans do require credit checks, secure short-term loans are specifically tailored towards people who deal with poor credit history. While they come with a certain amount of risk, they are a great option for people who would have a hard time getting approved for a personal loan from a bank, credit union, or online lender.

Another benefit is that if you are able to responsibly borrow and pay back your loan, you could help yourself in the long run by improving your credit score.

The major risks of short term loans are partly due to the fact that they are so easily accessible. Since short-term loans are often a last resort for people in a certain amount of financial trouble, borrowers can be subject to pretty high interest rates and added fees.

Short-term loans can be for any length of time, but on average they last just a couple of weeks to a couple of months. Interest rates can be high and if a borrower defaults on their loan, the run the risk of losing the collateral they used to obtain their loan such as a car, a house, or personal possessions they used at a pawn shop. They also run the risk of getting into trouble in the form of a debt spiral.

If you have other financial options, it is sometimes important to consider them. While short-term loans can get you out of a short-term jam, they can also lead to long-term financial issues if you lack the finances and responsibility necessary to pay off loans such as these.

Now that you know what kinds of personal loans are available to you, and what the pros and cons attached to those types of loans are, you can begin to start looking for what kind of loan works best for you.

What to Look For in a Reputable Car Title Lender

If you’re in need of some quick cash, one option to turn to is taking out a car title loan from a local title lender.

Car title loans can be a great option for quick cash because you do not need to reveal your credit score or financial situation. All you need is the title to your car to use as collateral against the loan that you want.

While car title loans may seem identical, there are certainly things to keep in mind and consider when you are choosing with local title loan to pursue.

Before breaking down things to keep in mind, you should know exactly what car title loans are.

Essentially, a local car title loan offers quick cash (typically somewhere between $100 and $5,000) in exchange for your vehicle’s title, or proof of ownership, as collateral. Car title loans are a type of secured loans, and many lenders can provide you with 24 hour title loans. That means that if you don’t pay back the lender within the repayment term, your lender is legally allowed to repossess your car.

What makes a local car title loan an attractive option for those in need of quick cash is that they are relatively non-restrictive when it comes to people who are able to apply and qualify.

Lenders typically do not check credit scores and don’t even necessarily require proof of income, proof of bank accounts, and more. All they require is that you can prove your equity in your car. True Financial is a lender that is able to help with car title loans for older cars

On caveat is that the vast majority of car title loan institutions will require you to own your car outright. One other thing that you find is that some lenders will require that borrowers either leave a key to their car or install a GPS tracker or a remote immobilizer in your car. This makes it easier for your lenders to find and repossess your car in the event that you default on your loan.

If you have decided that taking out a car title loan is right for you, there are some things you’re going to want to consider.

Title Loans are Only Available in Half of the States

If you are interested in taking out a local car title loan, you’re first going to have to find out whether or not the state that you live in even allows them. Due to their short payment terms, lump sum repayments, and high annual percentage rates, title lenders are only legal in 25 states across the country.

This is certainly something you consider before you opt to take out a car title loan. First off, you’re going to have to find if you can even access a local title loan. Also find out if your lender allows you to apply for a title loan with no job.

Look for Hidden Fees and Compare Interest Rates

A vehicle loan can be fairly straightforward. While the interest rates are high, there should be very few hidden fees, if any at all. If you find that there are hidden fees in a local car title loan that you are considering, it may be best to look elsewhere.

Similarly, as you would with any other type of loan, make sure to shop around and compare the interest rates offered by other local lenders. While all interest rates connected to car title loans will run a bit high, they do vary lender to lender. The higher the interest rate, the more money you will pay overall. Because car title loans are easy to obtain, it is definitely worth it to take the time to find the best interest rate available to you to save you money in the long term.

Title Loans Have High Annual Percentage Ratings

A loan’s annual percentage rate, or APR, is basically a way to measure how much a borrower can expect to spend on a loan in interest and other fees if the loan were to remain outstanding for a full year. What a 300% APR means is that if you are unable to pay off your loan, within a year you can expect to owe 3 times what you originally borrowed in fees and interest.

Technically, local car title loans are typically meant to last for a very short time – usually a few months. Within that month-long repayment term, interest rates are typically around 25 percent. Where people get into trouble is when they cannot afford to pay back their loan within the agreed upon payment term. That leads to the loan rolling over to the following month with another 25 percent interest tacked on to whatever is left. Before long, you’ll owe a boatload in interest and will be well on your way to that 300% APR nightmare becoming a reality. This can lead to a dangerous cycle of compounding debt that will leave you in an even tougher financial predicament than you were when you initially took out your loan.

The Amount You Can Borrow Depends on Your Car

You may think that the amount of money you can qualify for will vary from one local car tile loan institution to another, but typically the amount of money you can qualify for will remain fairly consistent across the market. That’s because the amount you can borrow is directly dependent on the value of your car. In fact, lenders can consider the car’s value that can be used as the collateral as well as provide the funds that typically vary between thirty percent to fifty percent of the total value of your car. That’s because if you default on your loan, and your lender decides to sell your car to recoup the cost, they are going to take the easy sale, not the sale that gets them the most money. That usually means selling far under value.

Look for the Experienced Companies and Look into Consumer Testimonials

When you’re choosing which local title lender you would most like to work with, definitely try to focus on companies that have been in business for a few years rather than a few months. Some lenders have been in business for over a decade. If possible, it is better to go with a company with years of experience, trust, and reputation.

Beyond that, it is best to see if a potential local car title loan institution offers testimonials from pervious customers. You should take the time to read through several of these to get an idea of what you can expect from a loan. Lenders that do not offer any customer testimonials should raise a certain amount of suspicions. Smart and reputable lenders will publish tons of testimonials, because they know that the proof is in the pudding. 

Your Vehicle Is Security For Your Loan

This is another thing to consider when choosing whether or not to take out a local car title loan.  When a borrower cannot pay back their loan, the lender has the option of repossessing their vehicle. 1 in 5 people who take our car title loans will ultimately end up watching their cars attached to the loan get repossessed. This will likely only increase the difficulty you are facing regarding your financial life because now that you don’t have a car, you could face even greater trouble getting to your job, or any interviews you have regarding a new job. Be sure to only apply for such loans if you know you have the ability to repay the loan quickly – such as some money you know is coming in from inheritance or sale of an asset

What to Know About Vehicle Repossession Laws

Having your vehicle repossessed is a scary thought for anyone. Most Americans need their cars to get to work, school, and everywhere in between. If you’re late on your payments, you could risk getting your car repossessed.  This is true whether you are late on your car loan payments, your lease payments, or if you have taken out a loan based on the value of your vehicle, such as a car title loan.

Essentially, when you finance or lease a vehicle, your creditor or leaser have ownership[ rights that end once you’ve paid off your loan or lease. These rights are established by the contract you sign and are upheld by the state in which you sign it.

Similarly, when you take out a car title loan, you are allowing a lending company to place a lien on the car’s title. That makes them a legal owner until you pay off your loan and they remove the lien on your vehicle.

The most important things to remember is that if you don’t make timely payments on your vehicle or a loan attached to your vehicle, your creditor or lender may have the right to repossess your car without warning and without going to court.

So, what are the laws that you should know when it comes to vehicle repo? Continue reading to find out.

When You’re in Default

Once you are in default with a lease or loan, most state laws allow the creditor to reclaim your car at any time without notice. They are also allowed to come onto your private property to do so. It is important to remember, however, that in most states, creditors cannot employ a “breach of peace” to repossess the vehicle. That means using physical force, threatening force, or, in some states, even taking the car from a gate or closed garage without your permission.

In the event that there is a breach of peace, it is crucial to know your rights within the state that you live. Your creditor may be required by law to pay a penalty or compensate you if any harm is done to your or your private property. A breach of peace may also give you a legal defense against your creditor if they sue you to collect any difference between what you owe and what the creditor gets in a resale of the vehicle.

Private Property Within Your Car

It is important to remember that even if your car is repossessed, any and all private property that is within your car at the time of repossession will remain your property.

Your creditor or lender is not allowed to keep or sell any private property that they may find in your car at the time of repossession. Your creditor is also required to use reasonable care to prevent anyone else from removing the private property in your car while it is being stored. If your creditor is unable to account for the private property that was in your car, you should speak to an attorney about your right to compensation for that property.

What Happens When Your Vehicle Gets Seized?

In many states in the U.S., your creditor or lender is legally allowed to seize your car as soon as you default on your loan or lease. Your contract will dictate what technically constitutes a default, but it is safe to assume that a failure to make an on-time payment will get you in trouble.

When it comes to title loans specifically, it is important to know the laws related to title loans in your state specifically. They can vary fairly dramatically.

When Your Vehicle Gets Sold

In the unfortunate even that your vehicle actually is repossessed by the lender or creditor, they can then decide to either keep the vehicle as compensation for your debt or sell it in a public or private sale to make up the money back that they lost.

In some states, your creditor or lender is required to let you know what will happen to your car. If the car is being sold in a public option, your creditor may have to tell you where and when that auction is taking place so that you can participate in the bidding. You can also find out the date and time of the sale if it is a private one. This information gives you the ability to buy back your car.

Once your car goes on sale, you will have the opportunity to redeem, or buy back, your car. You can do this by paying the full amount you owe. A word of warning, this likely includes any fees from past-due payments as well as any of your remaining debt. You will also have to pay any existing expenses related to the repossessing of your vehicle including storage, legal fees, preparation for sale, and more.

In some states, you will be protected by consumer protection laws that will allow you to “reinstate” your loan. That means that you can get your car back if you are able to pay the money you owe and pay for any of the expenses that your creditor incurred while repossessing your car. Once you get your car back, you have to be sure that you are able to complete your payments on time. Otherwise, you will likely face yet another repossession.

Paying Deficiency Fees

While any resale of your care must be carried out in a commercially reasonable manner, there may still very likely be a deficiency between what the car was resold for and what you owed. In that event, you will still have to pay your creditor a loaner the deficiency.

For example, if you owed $15,000 and your creditor was only able to resell the car for $10,000, you would be responsible for paying back the remaining $5,000 plus any other fees you owe under the previous contract.

Adversely, your creditor must pay you if there are any surplus funds from the sale, though that is far less common.

It is important to keep in mind that you may have a legal defense in a deficiency judgment if your creditor breach the peace while seizing the vehicle, failed to sell the car in a commercially reasonable manner, or waited too long before suing you. It is always wise to weigh your legal options before paying any deficiency fees.

Remember to Talk to Your Creditor Before Any Potential Repossession

As a rule, it is always easier to try and prevent a potential repossession than argue your vehicle repossession after the fact. Get in touch with your creditor once you realize you will be late with a payment. If they believe that you will be able to pay soon, they will likely give you some leeway.

Your creditor still has the right to refuse late payments, and they may demand that you return the car in place of a late payment.

Ultimate Title Loan Interest Rate Guide 2019

Typical Interest Rates on Title Loans Per State


It can be quite simple to acquire a car title loan in Utah as long as you own a car. The Title Lending Registration Actgoverns auto title loans in Utah and sets guidelines that all licensed lenders in the state are required to follow. 

Utah is one of the least regulated states for car title loans and is doing very well economically. The state does not impose any cap on the maximum loan amount or the interest rate charged. 

This actually works in the favor of the borrower, since title loan companies have to compete against each other for the lowest rate on offer. However, you need to make sure that you do your homework and shop around for the best loan terms and conditions.

Typically, the interest rate charged in Utah on car title loans is 25% monthly. However, this amount can exceed if you own the car jointly or if there are remaining standard loan installments on the car. 


The Virginia state government places restrictions on title loans in the state since the federal government is not known to actively participate. 

Title 6.2 of the code of Virginia governs title loans in the state. This code ensures the rights and responsibilities of borrowers in Virginia.

There are strict rules in this state where title loan interest rates are concerned. The amount of loan decides the maximum interest rates for title loans. Title loans that are $700 or less cannot be charged with an interest rate higher than 22%.

For title loans between $701 and $1,400, the maximum interest rate is 18% per month. Lenders cannot charge more than 18% if offering car title loans, regardless of the risk associated.

The maximum rate of interest on title loans that are $1,401 or more is 15% per month. Virginia protects its borrowers from high interests on title loans. There are many states where the interest rates are between 26% and 33%. 


Montana is among the few states that is pro-borrower where title loans are concerned. The interest rates are capped at 36% per annum as compared to monthly double digit rates in other states.

This is just 3% interest rate per month on a loan which does not take your credit score into account. In fact, almost all car title loan lenders in Montana offer these loans to people with bad credit scores.

The State of Montana has capped the fees for defaults and deferrals as well. It cannot be higher than 5% of the principal amount or $15 (whichever is greater).

However, because the typical interest rates are low, there are restrictions on the total amount you can borrow as well. This is to protect the average borrower from falling too deep into debt. 


There is no restriction placed on car title loans in terms of interest charged in Idaho. A lender can charge any interest rate on the loan amount based on your risk calculation. 

However, typically the rate of interest on auto title loans in Idaho is between 30% and 45% monthly and Idaho is a high quality of life state. This translates to an APR between 391% and 585%. 

It is your responsibility to find the most reasonable rates of interest and other charges. This is one of the least restricted states where car title loans are concerned. There is no set cap on the maximum amount you may borrow.

However, the loan amount will be at the lender’s discretion based on the value of your vehicle and the equity you hold in it. 

You can get a lower interest rate loan by showing viable source of income and by convincing the lender that you are a low risk borrower. Lenders offer lucrative interest rates when you borrow a lesser amount on a high valued car because it lowers their risk.


There are two laws that regulate car title loans: Chapter 537 and Chapter 516 under the Florida Title Loan Act. The Florida government has set maximum legal limits on the interest rate charged by a lender.

A licensed lender offering title loans in Florida cannot charge more than 30% per annum as simple interest. This amount is reduced to 24% of the principal if the car is valued over $2,000 and 18% if the car is worth more than $3,000 and remember Florida is a no state income tax state which is one reason why their economy is doing well.

However, this is just the maximum interest rate as prescribed by the government. It is possible that you may qualify for a lower interest title loan in Florida if you are a low risk borrower. 

For instance, if you have a viable source of income and a strong financial background, or if your car is worth much more than your loan amount. 

Florida does have some of the fastest title loan approval times in the US, most loans can be arranged in under 24 hours.


Delaware is among the many states that have placed restrictions on various aspects of car title loans. Primarily, caps on interest rates protect customers from financial ruin and getting stuck in a revolving debt trap.

While lenders can charge whatever they want in terms of interest rates in Delaware, the state has a number of regulations in place to ease the borrower’s burden of deep indebtedness.

The typical interest rate in this state is 25 percent a month, which equals to 300 percent APR, or annual percentage rate. However, if the fees and interest paid exceed the unpaid proceeds of the loan, the lender will have to refund that to the borrower provided the lender failed to make appropriate disclosures. These loans are designed for short term uses such as for emergency loans with no job.

An important thing to make note of in Delaware title loans is that the lender is allowed to keep charging interest rates on the balance loan amount, even after they take possession of your car and sell it to recover damages, in the event of non-payment.


Only licensed lenders are authorized to offer car title loans in Illinois. Where interest rate is concerned, Illinois regulations require all lenders to calculate it on simple interest basis and not compound interest. 

This means that you cannot be charged interest rate on any outstanding interest balance or interest fees that has not been paid.

There are no caps placed by the government on interest rates in the state of Illinois for title loans. This means that lenders set their own rates that can vary as per the lender you choose.

It’s vital that you choose wisely after asking for quotations from multiple lenders. You must also carefully consider all the terms of a loan before agreeing to that loan.

On an average interest rate charged by most lenders on title loans is not more than 25% in Illinois. However, it may be more if you are a high risk borrower. 


Maryland does not allow title loans. However, residents of Maryland can always head over to Virginia to acquire a car title loan with an out-of-state title. 

All rules and regulations pertaining to Virginia title loans shall apply since the actual loan contract cannot be signed on Maryland soil. In fact, Maryland government prohibits any advertisements or loan solicitations directed towards the residents of the state. 

In Virginia, the typical interest rate charged is based on the amount of loan borrowed. It is 22% for loans lower than $700, 18% for loans between $701 and $1,400, and 15% for higher amount loans. 

If you are a resident of Maryland and looking for a car title loan, then Virginia may be the nearest and best option. However, there are other states as well that offer these loans which may have even lower interest rates. 


Car title loans have a bad rep for being high interest loans. The high interest rate helps cover the risk associated with these loans. 

Arizona State is one of the more borrower-friendly states to get a title loan due to the Arizona title loan laws. Through Arizona Revised Statutes Title 44 – Trade and Commerce 44-291, the state puts caps on the title loan interest rates. 

Arizona uses a sliding interest rate table and is where there are very good prices for homes. So this is where the maximum monthly interest rate depends on the amount of the loan provided by the title loan company, with less expensive loans having higher maximum interest rates.

The maximum monthly interest rate that a title loan company can charge is 17% if the car title loan is $500 dollars or less. The interest is reduced to 15% when the loan amount increases to an amount between $501 and $2,500. 

The maximum monthly interest rate is 13% when the loan amount is between $2,501 and $5,000. The lowest monthly interest rate is 10% when the loan amount is $5,001 or more. 

The interest rate caps as set by Arizona are some of the lowest in the nation. 


As per California Car Title Loan Laws and Regulations a licensed lender of title loans cannot charge more than the prescribed limit by the state government. 

It is important to note that the minimum loan amount in California is $2,500 for title loans. If the loan is at exactly $2,500, title loan laws in California allow a lender to charge either $50 or up to 5 percent of that amount (whichever is lower). 

The interest is capped at $75 for loan amount between $2,501 and $4,999. There is no capped interest rate for any amount higher than $4,999. 

As such the environment in california is great when seeking a car title loan for older vehicles.

What are you going to get from your car title loan

Car title loans can be a fantastic way for you to get yourself out of some short-term financial trouble.

But it can also lead to future trouble if you fail to pay back your loan in time.

That’s because, in order to be approved for any car title loan, you’re going to have to put up your car’s title as collateral. That means that if you fail to pay back your loan, you will likely have to say goodbye to your beloved automobile. That’s because your lender will have the option to repossess your vehicle to recoup their losses.

It’s quite the price to be willing to pay.  Still though, if you’re considering taking out a car title loan, it’s important to know what you can expect to get, and what you can expect to pay in return.

How car title loans work

The basics of a car title loan are really quite simple. In order to lake out a loan against your car, you need to have equity in your car. For many lenders, they’ll only consider lending to you if you have already paid off your entire car and own it outright.

Once ownership has been established, the lending company that you are interested in working with will decide how much they are willing to lend you depending on the value of your car. Car title loans typically range between $100 and $5,500. In some states there are required minimums for title loans to be worth. In all states there are required maximums which typically land somewhere between $15,000 and $50,000.

It is true that the amount you can borrow is based on the equity that you have in your car and the value of that car, but do not expect to get a loan that is equal to the total market value of the car.

Lenders want to make absolutely sure that they’ll be getting their money back one way or another, so they will lend you only what they can get quickly and easily in exchange for your car in the event that you fail to pay back your loan. Most lenders will offer you a loan equal to between 25 percent and 70 percent of your car’s actual value.

As long as we’re on the topic of your lender wanting to ensure that they can easily get their money back in the event that you fail to repay the loan, it is important to know that some lenders will require you to install a GPS tracking device on your car so that they can easily locate it in the event of a repossession. This should be a sign of just how serious car title lenders are when it comes to making sure they are either to recoup the money they loan out.

What you need to pay off your loan

Before you take out your car title loan, it is very important that you know how long the payment terms of title loans are. Typically, they’re quite short. After you take out your loan, you will be expected to pay back the loan in full, plus interest and any possible fees, typically within 15 to 30 days. While some car title loan repayments can include multiple payments in one term that spans over a number of months, most title loans include what is called a balloon payment. A balloon payment is a lump-sum payment at the end of your payment period that includes the loan payback and any interest and fees you incurred. Basically it’s an all-in-one repayment to close out your loan.

In some cases, you will have the option to roll over the loan to the next month if you can’t pay it back. That will certainly come with added fees, however, and you have to know what kind of fees to expect before you decide to roll over your loan. Not only will you have to accrue added interest fees, but you could also face late fees and other hidden fess as well.

It is important for you to know exactly what your interest fee is. The average interest rate on car title loans is approximately 25 percent. That might not sound too bad, but if you roll over your loan, and 25 percent interest is applied to each roll over, your small loan can turn into a huge financial burden. If you were to carry the loan for a full year, the APR or annual percentage rate, would be 300 percent of your original loan. That’s a serious hole to find yourself in, and it’s even harder to dig yourself out of that hole if you lose your car as a result of not being able to pay back your loan.

In the end, it is quite likely that you will be paying back a significantly larger amount than the original loan was.

What if you default

Paying back your loan plus interest is one thing, losing your car is something else entirely.

That’s what you have to be prepared to risk if you take out a car title loan. In the event that you are unable to pay back your loan, or keep up with your payments, your lender can repossess your car and sell it to make up for the money they have lost by lending you money you can’t repay.

If your car is repossessed, your financial situation could quickly go from bad to worse. Without a car, you might have a harder time getting to work or finding work. You could even have a harder time doing simple things like going grocery shopping, taking your kids to school, and more.

Before you take out a car title loan, it is imperative that you take a look at your daily life and decide whether or not you are willing to put your car on the line. Don’t treat a car title loan like a way out of financial trouble for good, that’s not what there here for. What you should instead consider it as is a necessary stopgap. When you’re really in need of fast cash, a car title loan can be a great help, but make sure that you have consistent money coming in aside from that so that you can pay it off in time.

How To Get Out Of A Title Loan As Quickly as Possible

Ways to Get Out of a Car Title Loan

If you’ve ever taken out a car title loan, you know how easy they are to get. You may also know how hard they are to get out of. In the end, title loans can be quite expensive because they typically end up taking quite a bit longer to get out of than you originally suspect. Because they take longer, you risk accruing more and more interest fees and added fees and months go on. They can also be quite the bother because you can, as the name suggest, lose your car in the process.

So, how can you get out of a title loan? You’ve got a few options for relief.

The Easiest Option

This may not be much of a surprise to you, but we figure we should probably mention it anyways. The easier way to get out of your title loan is to pay it off. That is, however, easier said than done. If you had had the money in the first place, you probably wouldn’t have taken out the loan to begin with, and even if you are able to pay it off slowly, the interest loans can make it quite hard to make an impact overtime. If you do come into the money needed to pay it off, contact your lender immediately. Don’t be surprised if they’re not as enthusiastic about closing your loan as you are, though. Some lenders have been known to drag their feet to try and milk more money out of their customers who are already on the hook.

Swap the Car

If you simply do not have the money to pay off your loan, you can always sell the car you used as collateral to generate some cash. You will likely find that selling it is difficult because you do not have a clean title, but it can be done and it happens quite often. You can downgrade to a less expensive car, pay off your loan, and free up your cash flow. This can be a great option if you are able to find someone willing to take your car off your hands.

Refinance or Consolidate Your Loan

This is another way to get your title lender off your conscience and while it seems counter-intuitive, it actually makes a tone of sense. Refinancing a loan basically means replacing it with another loan, or taking out a different loan to pay off the original loan.

The way this works is when you are able to find a loan with a lower, fixed interest rate. You’ll still owe the same amount of money you owed on your title loan, possibly more, but it will not balloon and grow the way that your title loan was doing on account of its high interest rates.

Target a fixed-rate loan from a bank, credit union, or online lender first. You can also use a convenience check from your credit card if you are positive you’ll be able to pay it off in time before the promotional period ends.

If you find yourself running into roadblocks by seeking out title loans from those types of establishments, consider visiting small local banks and credit unions. You may have a better chance of getting approved at places like that.

As a final resort, consider seeking out a peer-to-peer loan, or even asking someone you know to co-sign on a loan with you to help you get approved. Just make sure that they know what they are financially and legally responsible for when they agree to be your co-signer.

Talk to Your Lender

Your existing lender may be willing to work with you if you know the right way to negotiate. Offer to pay what you can and see if the lender accepts that. This can be an especially solid option if your finances are quickly starting to spin out of control. If your lender sees that they have an opportunity to recoup anything from you, they might jump at the opportunity to do so. True Financial is available 24 hours a day for title loan to refinance a car title loan in California or apply for a new loan.

Even if your financial situation is quite that bleak, you may be able to talk you lender down to a lower interest rate or other adjustments to your payments in order the lighten the load. It could be a win-win for both parties, so it’s smart do advertise is at such.

If your lender does agree to take less than you owe, your credit will suffer, but a lower credit score is certainly a better option than financial ruin.

Default on Your Loan

Another option is to simply stop paying your loan. This is obviously not the best option because it will seriously damage your credit and your lender will eventually repossess your car. You may also still owe money on the loan if your car is not sold for more than the amount you owe. Still, you can take solace in knowing that you’ll be done with monthly payments, and that may be enough to help you get yourself set on a better financial path.

A small tip to keep in mind if you are considering defaulting on your loan is that voluntarily surrendering your vehicle can improve the situation and your credit score might not dip quite as much.

Avoiding Title Loans

Perhaps the best way to avoid getting into the potential sticky situations that come with title loans is to avoid them altogether. Instead, try to build yourself an emergency savings fund of three to six months’ worth of expenses and improve your credit so that you have more options the next time a financial hardship rears its ugly head.