Looking for collateral loans on a car title? You’re in the right place. Using your car title as collateral to get a loan is a good option if you need emergency cash and would prefer to avoid other alternatives like payday loans.
But if you’re confused or need help understanding the process of getting a car title loan, you may not know where to start. So, let’s go over all of the basics about how to use your car title as collateral to get a loan now!
What Is Collateral?
Collateral is any property that you put up when applying for a loan to secure the loan and reduce risk for the lender.
When you bought your car, for example, you probably didn’t own it. The bank or lender owned it, and you made payments on it, based on your loan agreement. The car was collateral for this loan. If you stopped paying, the lender owned the car – so they could repossess it and sell it to recover the money that went unpaid.
In the same way, you can use your car as collateral to get a loan after you’ve paid it off, by working with a car title loan provider and taking out a new loan on your vehicle.
How Do Collateral Loans on Car Titles Work?
Basically, if you have a car title that is “free and clear” – you don’t owe any money on your car – you can qualify for a car title loan.
You send over your title, and they provide you with a lump sum payment. They take possession of the title temporally, but you get to keep your car. Then, to get your car title back and regain ownership of your car, you simply have to repay the title loan as outlined in your title loan agreement. Once you’ve repaid your loan plus applicable interest and fees, your title is yours again.
But if you don’t repay, the title lender has the right to repossess the car which was put up as collateral. Then, they may choose to hold your car until you repay what you owe plus any applicable late fees.
This is why it’s only a good idea to apply for collateral loans on car titles if you’re certain that you can repay. If you are unable to repay your loan, you could lose your car.
Interested in a Collateral Loan on Your Car Title? Apply at Title Loan Fast Today!
At Title Loan Fast, we offer collateral loans on car titles. Our car title loans are transparent, reasonably priced, and we offer fast payments and convenient customer service. If you’re interested in taking out a title loan, head to our website now, and start your application today!