Personal Car Title Loans

Explore personal car title loans through zaving, providing quick financial assistance secured against your vehicle's title.

Last updated by Zaving Editorial Team, on January 19th, 2024

Interested in personal car title loans? If you need some urgent cash to get you through a tight spot, you can turn to zaving to help you explore your options. Our online service makes applying for a loan quick, easy, and hassle-free. If your loan is approved, cash can land in your bank account straight away – it's as simple as that! Start the application process right here today with zaving.

What is a car title loan and how does it work?

“A car title loan is a short-term, secured loan where borrowers use their vehicle's title as collateral to access funds. These loans are typically for smaller amounts and have shorter repayment periods compared to traditional loans. To secure a car title loan, the borrower must own the vehicle outright or have a considerable amount of equity in the car. The lender evaluates the vehicle's value and determines the loan amount based on this assessment.

The process involves the borrower submitting their vehicle's title to the lender and agreeing to pay back the loan, usually within 30 days or as per the loan terms. Interest rates on car title loans can be notably higher than traditional loans, often exceeding triple-digit APRs, increasing the overall repayment amount.

If the borrower fails to repay the loan according to the agreed terms, the lender has the right to repossess the vehicle. However, if the loan is repaid as per the agreement, the borrower retains ownership of the vehicle.

Car title loans are appealing for those with poor credit, as credit scores are typically not the primary consideration for approval. These loans offer quick access to cash but come with significant risks due to high interest rates and the potential loss of the vehicle if payments are not met. Therefore, it's crucial for borrowers to carefully assess their financial situation and repayment capabilities before opting for a car title loan.”

How are car title loans different to payday loans?

“Car title loans and payday loans differ significantly in their structure and collateral requirements:

  • Collateral: Car title loans mandate using the borrower's vehicle as collateral, enabling access to larger loan amounts based on the vehicle's value. In contrast, payday loans are unsecured and don't require collateral; they're based on the borrower's income, typically offering smaller amounts.
  • Loan amount and duration: Car title loans generally offer more substantial sums that can be repaid over an extended period, often several months to a few years. Payday loans are short-term, usually due within a few weeks or by the borrower's next paycheck.
  • Interest rates: Both types tend to have high-interest rates. Car title loans may have comparatively lower rates due to being secured, while payday loans, being unsecured, can have higher rates due to the absence of collateral.
  • Application process: Car title loans often involve a vehicle inspection and consideration of the vehicle's condition and the borrower's credit history. Payday loans have simpler applications, typically requiring proof of income and identification.
  • Risk of asset loss: Car title loans pose the risk of vehicle repossession if payments are missed. Payday loans, being unsecured, don't involve the risk of losing an asset but might result in additional fees if not repaid promptly.
 

Understanding these differences is crucial when deciding between the two. Borrowers should carefully assess their financial situation and consider the terms, repayment capacity, and associated risks before choosing the loan that best suits their needs.”

Can people with bad credit or no credit history access car title loans?

“Individuals with poor credit or no credit history can access car title loans, often marketed explicitly to this demographic. These loans use the borrower's car title as security, reducing the lender's risk and increasing approval chances for those with bad credit.

Car title loans appeal to borrowers with poor credit due to several reasons:

  • Simplified qualification: Unlike traditional loans relying on credit scores and income proof, car title loans hinge on the vehicle's value.
  • Quick funding: Car title loans boast rapid processing, often disbursing funds within 24 hours, catering to urgent financial needs.
  • No credit checks: Typically, car title lenders bypass credit score evaluations, facilitating loan access regardless of credit status.
  • Flexible repayment terms: These loans commonly offer adaptable repayment schedules, easing the burden for individuals living paycheck to paycheck.
 

Despite these benefits, understanding the risks associated with car title loans is vital before securing one, including high interest rates, short repayment periods, and the potential for vehicle repossession. Borrowers, particularly those with poor credit, should weigh these factors before committing to ensure they can manage the loan responsibly.”

More of your frequently asked questions about payday loans

Which US states allow car title loans?

Car title loans are sanctioned across numerous U.S. states, but their regulations vary considerably and can change. As of December 2023, the states allowing car title loans encompass Alabama, Arizona, California, Delaware, Florida, Georgia, Idaho, Illinois, Kansas, Kentucky, Louisiana, Minnesota, Mississippi, Missouri, Montana, Nevada, New Hampshire, New Mexico, Oregon, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, and Wisconsin. Yet, terms, regulations, and maximum loan amounts diverge significantly among these states. While some states have strict regulations, imposing limits on interest rates or loan amounts to safeguard consumers, others grant lenders greater flexibility.

Can I get a car title loan if the vehicle is not fully paid off?

Acquiring a car title loan when the vehicle isn't fully paid off could be feasible with certain lenders, as they might consider the vehicle's equity for approval. However, the loan amount could be affected, usually limited by the equity available after subtracting the outstanding balance. To gain clarity on the process and terms for obtaining a car title loan under such circumstances, it's advisable to engage directly with lenders and comprehend their unique terms and conditions.

How quickly can I get a car title loan?

The process of obtaining a car title loan typically offers swift access to funds, often within a day after approval. However, the speed of securing this loan can depend on factors such as the lender's processing efficiency, the thoroughness of your application, the assessment of your vehicle's worth, and adherence to the lender's eligibility criteria. Providing precise details and having necessary documents ready can expedite the approval process and the transfer of funds.

What are the pros and cons of car title loans?

Car title loans come with their share of advantages and drawbacks. They offer immediate access to cash and are available to individuals with less-than-perfect credit, leveraging their vehicle's title as collateral. Furthermore, some lenders might permit continued use of the vehicle. Nonetheless, these loans often carry steep interest rates and fees, increasing the overall repayment amount. Defaulting on payments could lead to the repossession of your vehicle. Carefully evaluating these factors is essential before committing to a car title loan to ensure it fits your financial situation.