If you need fast cash, it’s important to explore all of your options, including taking out a title loan. A title loan is not the same as a traditional personal loan. Title loans are secured, which means they are supported by collateral. To obtain a title loan, you must be willing to use the title to your vehicle as collateral.
You won’t have to hand your keys to the lender to borrow money through a title loan. If you are approved for a title loan, you can continue to drive your car as you normally would while you make payments. In the meantime, the lender will put a lien on your title until your debt has been satisfied.
Because it is used as collateral, your car plays an important role in getting a title loan. If you’re considering applying for a title loan, you might be wondering whether a lender will accept your car as collateral. Can you get a title loan on a leased car? What about a car that you are still making payments on? Here’s what you need to know:
Can You Use a Leased Car as Collateral for a Title Loan?
If your car is leased, the first question on your mind may be whether you can use it as collateral to borrow money with a title loan. Unfortunately, the answer is no, you cannot get a title loan with a leased car.
The reason for this is simple. Your vehicle is used as collateral to secure your title loan. In other words, if you fail to repay your loan, the title loan company has the right to take possession of your vehicle to satisfy your debt.
However, if your vehicle is leased, it doesn’t belong to you. It belongs to the leasing company, so the title loan company cannot take possession of it to satisfy your debt in the event you stop paying. For this reason, a leased car cannot be used as collateral for a title loan.
Can You Get a Title Loan If You’re Still Making Payments on Your Vehicle?
You must own your vehicle in order to use it as collateral for a title loan. If you’re still paying off your car, you might wonder whether this will impact your eligibility for a title loan.
You may qualify for a title loan even if you are still making payments on your vehicle. However, you must have equity in your vehicle. If you owe more on your vehicle than it is worth, you cannot use it as collateral for a title loan.
Because every applicant’s situation is unique, eligibility is determined on a case-by-case basis. In general, though, many people who only have a few payments left on their auto loan qualify for a title loan.
What Are the Other Title Loan Eligibility Requirements?
There are a number of eligibility requirements that you must meet in order to qualify for a title loan, including:
- You must be at least 18 years old.
- You must own or partially own a vehicle.
- You must have equity in your vehicle.
- You must be willing to consent to a credit check.
- You must have a reliable source of income that you can use to repay the money you borrow.
Some lenders may have additional eligibility requirements. To find out if you qualify, it’s best to contact your title loan company directly.
How Much Can You Borrow With a Title Loan?
Lenders typically issue between $2,000 to $50,000 per title loan. Your title loan amount will vary depending on several factors, including:
- Your income: You will need to submit proof of income during the title loan application process. This allows your lender to evaluate your income and determine how much you can afford to repay.
- Your car’s resale value: You cannot borrow more than your vehicle is worth. To calculate your car’s resale value, the title loan company will assess its make, model, year, condition, trim level, and mileage.
- Your equity: You must have equity in your vehicle to qualify for a title loan, and you cannot borrow more than the value of your equity. To calculate your equity, subtract the amount you still owe on your vehicle from its resale value.
- Your location: A number of states, including Illinois, Mississippi, and New Hampshire, have passed laws that establish minimum and maximum title loan amounts. If you live in a state with these laws, they could impact how much you are allowed to borrow with a title loan.
It only takes a few minutes to find out how much you can borrow. All you need to do is contact the title loan company and request a free loan estimate.
What Are the Benefits of Getting a Title Loan?
There are countless reasons why so many people rely on title loans to get the cash they need. Title loans offer many benefits, including:
- Fast processing times. You shouldn’t have to wait to get the money you need. Fortunately, title loans are typically processed faster than other loans, so you can get your hands on the cash you need as soon as possible.
- You keep your car. Your lender won’t take possession of your vehicle unless you fail to repay your loan, which means you can keep your car throughout the entire process.
- No prepayment penalties. You won’t be charged a fee if you choose to pay your loan off earlier than expected.
- Simple application. The title loan application process is simple and straightforward. In fact, the entire process can be completed online or over the phone.
- Easy to qualify for. The eligibility requirements for a title loan are not the same as the eligibility requirements for a traditional personal loan. This means you may qualify for a title loan even if you aren’t eligible for a traditional personal loan.
How to Apply for a Title Loan
Now you may have a better understanding of whether your vehicle can be used as collateral to secure a title loan. If you’re ready to secure the fast cash you need, follow these steps to apply for a title loan from 1(800)CAR-TITLE®:
- Contact us. There are two ways to get in touch with our loan specialists. You can call our team directly at 1-800-227-8485 or submit your information using the form on our website. If you choose the second option, a member of our team will reach out to you as soon as possible.
- Get a free loan estimate. Your loan specialist can prepare a loan estimate that tells you if you are approved for a title loan and if so, how much you can borrow and at what interest rate. To prepare this estimate, your loan specialist will ask for some information about your vehicle, including its make, model, year, and mileage.
- Finalize your loan. If you’re happy with the terms in your loan estimate, you can move forward with the process by signing and submitting the required documentation. Your loan cannot be processed until this step is complete.
- Collect your cash. Your money will be available shortly after your application is approved. Once the money is available, you can pick it up in person or have it sent to you via check or wire transfer.
Don’t wait any longer. The sooner you start the title loan application process, the sooner you can get the cash you need to make ends meet.