Car title loans are a less well-known form of borrowing that can provide a quick and easy financial solution to those in need of emergency cash. These types of loans differ from more traditional loans from a bank or a credit union. Here are some of the most frequently asked questions about car title loans.
What Is A Auto Title Loan?
It is a form of secured loan where a vehicle is used as collateral. The owner of the vehicle must possess the title and it must be free and clear of any liens. In most cases, the vehicle must be paid off.
How Can I Qualify For A Auto Title Loan?
In most cases, you must be at least 18 years of age, own a vehicle free and clear, and the vehicle must be 10 years old or less. Also, anyone applying for a car title loan will have to have a driver’s license, insurance for the vehicle, and provide documentation of residency.
What Are The Vehicle Requirements?
As stated, most title loan companies will require that the vehicle be no more than 10 years old. There are, of course, exceptions. The car or truck should be in good working order and have a minimum blue book value. Many title loan companies require a vehicle to have a blue book value of at least $2,500.
How Much Can Be Borrowed?
That will depend upon the value of the vehicle. Embassy Loans of Florida is a consumer finance company that has helped thousands of customers obtain car title loans. Embassy Loans will examine the title to make sure it matches the vehicle (by matching VIN numbers) and then establish a value. Once the value is established, a loan is usually made for approximately 50 percent of that value. If the car is worth $10,000, the loan will be for roughly $5,000.
Does A Borrower Need Good Credit?
No. A car title loan is not based upon a borrower’s credit history. The loan is secured by the vehicle. If the borrower does not repay the loan, the lender takes possession of the vehicle and sells it to recover any losses.
How Long Does It Take To Get A Car Title Loan?
At Embassy Loans, the average processing time is an hour. A borrower fills out the application and provides the necessary documentation. Embassy Loans verifies it and appraises the vehicle. The loan documents are drawn up and signed. The money is deposited into the borrower’s checking account. Many times, a car title loan can be completed in a just a few hours.