Get Started
car title loans

Considering Alternative Lending Options? Find Out How Title Loans Work

Right now, an increasing number of people are looking for alternative lending options. This could be due to a number of reasons, from poor credit scores to the lack thereof. 

Whatever situation you’re in, it’s important to understand the lending options available to you. 

Whether you’re dealing with a low credit score or the lack thereof, one of the options available to you is a car title loan. 

Essentially, a car title loan is when the borrower uses their lien-free car title as collateral, and the amount they are approved to borrow depends on their car’s value. 

In this article, we’re going to explore how title loans work in a little more detail, and how you can find one near you. 

Who Are Car Title Loans For?

One of the most important questions to ask when finding out how title loans work is who they are for. 

Car title loans are for a wide range of people but are specifically ideal for those with a lower credit score, as mentioned above. 

If you have a poor credit history, getting a loan may feel out of reach - but car title loans can help you get the money you need. 

With car title loans, while your credit score will still be checked, it will not affect the decision as much as it does with other loans. Instead, there are a few more things that affect the decision even more, such as your car’s value - which we will discuss later. 

So, if you’re looking for an alternative lending option due to your lower credit score, it might be worth considering a car title loan!

alternative lending options how title loans work

How Much You Can Borrow?

Another aspect of knowing how title loans work is knowing how much you can borrow.

Depending on the lender, you can borrow between 25 and 50% of your car’s value, as calculated by the lender themselves - but we’ll get onto the process later on in this article.

Therefore, if you’re looking to get a car title loan, it’s worth getting a few professional opinions on your car’s value so you can calculate how much you could borrow based on the average valuation.

This way, you can be ahead of the game when it comes to calculating the amount you can get, the amount you need, and the amount you can afford to repay in a car title loan. 

Use Your Car Title As Collateral

As we’ve mentioned above, the main point of how title loans work is that, with a car title loan, you will use your lien-free vehicle title as collateral. That means you will secure the money you are borrowing with your vehicle title. In doing so, the lender will place a lien on the title until the loan is paid in full. Once that happens the lender will remove the lien and transfer the title back to you.

Using your car title as collateral has several advantages; first, getting a car title loan is usually super easy and fast - all you need is your car and a few simple documents. In addition, while some loans may require a guarantor to ensure you can pay them back, car title loans do not require this. 

Therefore, using your lien-free car title as collateral - which is the defining part of car title loans - has several advantages. 

If you are worried about not having the use of your vehicle, don’t be, with a car title loan you can keep and drive your car while you make payments on the loan.

getting fast auto title loan cash

The Process Of Getting A Title Loan

So, now we’re getting to the first steps you can take to get a car title loan.

To get started, many lenders, such as Auto Cash USA, have a form for you to fill out on their website. Here you can enter your information and requirements to connect with a lender near you.

Next, a loan representative from the store will call to walk you through the loan process and schedule an appointment to value your car and check your documents. 

Once this has been done and you’ve completed all the necessary paperwork, the decision is usually fast - and, if approved, you’ll usually get your money quickly.

Auto Cash USA

Now that you know how title loans work, it’s time to check out Auto Cash USA! All you need to do is fill out their online form to get started. You will then be contacted by a lender in their network of licensed vendors that fits your financial needs. The loan specialist from this location will call to confirm your information and explain the requirements, as well as arrange a meeting to get your documents verified and your car valued. 

Once you’ve completed the process, if you’ve been approved, you will get your money on the same or the next business day. 

Getting Your Title Loan Started Today

So, above, we’ve explored how title loans work and what the process of getting one is. 

Now that you know a little more about title loans, if it’s still an option for you and your situation, take a look at Auto Cash USA! Their easy and hassle-free online form is one way you can begin your journey toward getting a car title loan. 

Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.

Mason Roberts

Mason Roberts is a seasoned economics writer and blogger with a knack for breaking down and simply communicating the ever-changing world of finance. He is philosophically committed to the premise that financial knowledge equals financial freedom.