You are reading this because you are either looking to obtain a title loan, you have a title loan or you are just generally interested knowing more about this loan product. So, firstly.. Welcome! Let's start off by giving a brief understanding about how these loans work.
A car title loan or pink slip loan is a loan secured by a vehicle (or car, boat, truck etc) that you already own. Its similar to a loan you get when you buy a car, however the difference here is that this is for a car that is remaining with the same owner, there is not a purchase or sale of the vehicle going on. Borrowers like these loans because they are quick and easy. This makes they an attractive option for a short term cash need.
Ultimately title loan requirements differ depending on what state you are in. Even so, most title loan company's have similar requirements to apply with them. Firstly. applicants must fill out basic paperwork (or complete an in person or on the phone consultation). Supporting documents are going to be required as part of initial loan application process. Some required documents include: proof of monthly income, a government-issued ID, current automobile full coverage, current vehicle registration, the title itself and the vehicle being used as collateral. If the title has another owner listed as well, that individual must be present during this process too. Typically a free and clear title is required; however some of the best title loan companies may be willing to work with salvage titles depending on the situation.
For many individuals their vehicle is a good source of collateral to fund the cash they need in emergency financial situations. Title loans, compared with a vehicle pawn, allow drivers to stay on the road during the loan term as long as they continue to make on-time payments, so you can think you get to keep your car. The car is at risk somewhat which is not so detrimental if the vehicle you have offered to a lender for security is a second car. However making payments and aiming to repay the loan is something you need to be prepared for and feel confident you will be in a position to do so. Title loans have many benefits over other short term loans such as pay day loans. Read more here about the differences between a title loan and a payday loan
Applying for a title loan is usually a quick and seamless process. Some advantages or benefits of these auto loans or liens is that they are easy, convenient and fast. These loans help borrowers to unlock the value in their title and keep them on the road with easy payments. It’s important to understand the loan terms before agreeing upon them. Yes the interest rate is going to be higher due to reality that these are higher risk loans for the lender and that often no credit checks are required. During a title loan, borrowers can get the cash needed quickly as long as they promise to pay it back with interest on time. In the state of California, applicants must be a minimum of 18 year old with a valid government-issued ID and have a clear title to be eligible. Also the vehicle needs to be entirely or substantially paid off. Most title loans can be funded in less than just one hour. It’s important to remember and understand that these loans are meant to be short-term so you will be making large payments quickly to the title loan company. You loan consultant will be able to give you all the information you need payment fees and APR before signing documents.
The overall loan process is simple and starts with contacting an online lender or visiting one in store. Once you are approved all you need to do is hand over the vehicle’s title and get your cash. The title loan company will keep the title (or hold a lien on the title) until you're at the stage where your loan has been paid back in full. After you have repaid you loan, you will receive your title back. This is where the risk is. As much as a car title loan is easy to get, you want to be sure you are prepared to make the payments so that you can continue to enjoy the use of your vehicle. Some times you can ask for more money at a later date, usually only if you have been up to date with making repayments and keeping good communication with your lender.
Most title loan applicants will get cash relatively quickly - with many lenders able to both approve and fund a loan the same day that you apply. A good title loan company will believe in offering easy loans to all types of customers when they need it the most. Also one thing to look for in a lender is flexibility in terms of the vehicles that they will accept as security. If you have a salvaged title, you would need a lender who understands and provides salvaged title loans. When someone is in a bind, title loans can be one of the best options, regardless of one’s credit, to get money fast. Always research your options before committing to a title loan or any other type of fast money option. Many title loan companies require full coverage insurance on the vehicle used as collateral at all times to ensure their risk is low. So factor the cost of insurance, which you should have anyway.
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