How does a car title loan work?

Car title loans are a popular option for people who are looking for a faster way to borrow money. In some cases, loans can be secured in a matter of minutes. Bank loans, and other types of unsecured loans, can involve a much lengthier process, since credit checks must be conducted before a loan is approved.

What Can I Expect from the Car Title Loan Process?

How car title loans work explained

Unlike traditional (unsecured) loans, since there is no credit check, the title loan process is straightforward, fast, and simple.

Below, you’ll find each of the steps in the car title loan process:

Fill Out An Application Online

To initiate the loan process, you will need to fill out an application with a lender. This application typically requires basic personal information, details about the vehicle (make, model, year, mileage), and proof of ownership (the vehicle’s title). Some lenders may also require proof of income or employment.

Vehicle Assessment

After the initial application, the lender usually evaluates the vehicle’s value. This involves a physical inspection and assessment of the car’s condition, mileage, and overall market value. The loan amount offered is often a percentage of the appraised value of the vehicle.

Look Over the Loan Terms

If the application is approved, the lender provides you with a loan offer. This offer outlines the terms of the loan, including the principal amount, interest rate, repayment schedule, and any additional fees.

Provide the Vehicle Title

Upon agreeing to the terms, you will need to provide the lender with the vehicle’s title. The lender becomes a lienholder on the title, indicating their legal claim to the vehicle until the loan is fully repaid.

What is the Repayment Structure for Title Loans?

Repayment structures for car title loans can vary, but they often involve short repayment periods. You might be required to make monthly payments or lump-sum payments within a specified timeframe, usually ranging from 15 days to 30 days. In some cases, you may have up to a year to repay the loan in full. Payments typically include both the loan principal and the accruing interest.

How Long Does it Take to Secure a Loan?

Most title loans can be acquired within 24-48 hours or less depending on the size of the loan and most lenders typically do not check the credit history of borrowers and only consider the value and condition of the vehicle that is being used to secure it.

How is My Car Valued?

There are 5 main things the title lender needs to know on the car itself. If you know the VIN number of your car, this will make it much easier and much more accurate to get the correct value.

  • Year
  • Make
  • Model
  • Miles
  • Extras

What Information Do I Need to Provide When Applying for a Loan?

When you get ready to get your money you MAY need the following:

  • Govt. issued photo ID
  • Car
  • Three references not related to you
  • Insurance information
  • Social security number
  • Pictures of your car (all 4 sides including VIN and Odometer)

Will the Lender Keep My Vehicle Until the Loan Has Been Repaid?

Throughout the loan term, you will retain possession and the use of your vehicle. However, the lender holds the title and has the legal right to repossess the vehicle if you default on the loan by failing to make a payment.

What Happens After I Pay Off the Loan?

Once you have paid off the loan in full, including all principal, interest, and fees, the lender releases the lien on the vehicle’s title. At this point, you will regain full ownership of the vehicle.

Find Out if You Qualify

At Fast Money Car Title Loans, we can connect you with a local reputable lender who can provide a fair car title loan based on the value of your vehicle and other factors. We take great care in vetting the lenders in our network to ensure you work with one that offers you the loan you need, with reasonable terms and payment options.

To learn if you qualify for a car title loan, fill out the form on this page to get started. Our customer service staff will respond promptly to answer any questions and connect you with lenders that can help you secure the loan you need, as quickly as possible.

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