Most people don’t think twice about taking out a loan or using credit to get what they want, whether it’s that new TV or car. However, there are times when people find themselves in situations where their only option is to take out a car title loan, which is a type of secured loan on an asset. Unfortunately, most people have no idea what the requirements are or what they need to provide in order to get approved for this type of loan. In this article, we’ll discuss the most important things you need to know about car title loan requirements.
What is a Car Title Loan?
A car title loan in California is a type of secured loan where you can put up your car as collateral. If they are unable to repay the loan, they may be able to extend the loan or roll it over into a new loan. However, if they default on the loan, they may lose their vehicle. In addition, these loans often come with very high-interest rates that can quickly increase.
Title loans require no credit check, but borrowers must have a steady source of income and prove their ability to repay the loan. Repayment is made in full at the end of the term period. Lenders will also want to see proof that you own your vehicle outright. You’ll need an up-to-date copy of your registration and there’s no penalty for paying off early.
1- What are the Title Loan Requirements?
When you apply for a car title loan in California, you’ll need to provide the lender with a clear title to your vehicle. You’ll also need to provide proof of insurance, as well as your driver’s license and registration.
In some cases, you may also need to provide proof of income and residency. Be sure to bring all required documents with you when you apply for a loan. Depending on the state in which you live, additional requirements might be necessary to meet this type of loan’s requirements. A few examples are providing your bank account number or utility bill.
Most car title loan South Gate CA lenders typically require the following:
- A lien-free car title in your name
- Evidence of ability to repay the loan
- A government-issued ID
- Proof of income
- Your car for inspection
- Some personal references
- A clear understanding of the loan’s terms and conditions
2-Is It Wise to Get a Car Title Loan in California?
While car title loans can offer much-needed relief in a financial emergency, they also come with high risks. Before you take out a car title loan, make sure you understand the requirements and the risks involved.
You must own your car outright to qualify for a car title loan. That means you can’t have any outstanding loans or leases on the vehicle. You’ll need to provide the lender with proof of ownership, typically in the form of a vehicle registration document or certificate of title. The lender will hold onto this document until you repay the loan in full. If you default on the loan, they may be able to repossess your car.
3-Is Credit Score a Car Title Loan Requirements?
You don’t need perfect credit to get approved for a car title loan, but you will need to demonstrate that you’re capable of repaying the loan. The requirements vary by lender, but most will look at your credit score, employment history, and income. If you have bad credit, you may still be able to get a car title loan by providing collateral or finding a cosigner. As long as you meet the qualifications, there’s no reason not to apply for a car title loan!
4-How Much Can You Expect to Pay in Interest on the Loan?
If you’re thinking about taking out a car title loan, you’re probably wondering how much it’s going to cost you in interest. The average APR on a title loan is 225%.
That means that if you take out $1,000 and pay it back over five months at an average of $250 per month, your total expense will be $3,500. You might not even have to worry about paying the full $1,000 back though! You can often borrow up to 75% of the value of your vehicle from lenders, which means that you could end up paying as little as $750 for a car title loan (although this does depend on your credit score).
Find a Trusted Lender for a Car Title Loan in California
A car title loan in California is a great way to get the money you need fast. But before you apply, make sure you understand the requirements. This way, you can be sure you qualify and are getting the best deal possible. Quick Title Loan provides fast, easy, and no-credit-check car title loans in California. We have an easy application process. Contact us today to learn more about our car title loans!