If you need fast cash, you may be worried about qualifying for a loan if your credit is poor. So, what are the requirements for a car title loan, and do you need perfect credit to apply?
It is frustrating, to say the least, to go through the entire application and process to obtain a loan only to be denied because of your credit score. How are you meant to improve your credit when you are in need of emergency cash and have nowhere to turn?
Luckily, getting a car title loan is a bit more straightforward. The requirements for a car title loan are different from that of other types of personal loans which can make them an excellent option for individuals with subprime credit or unconventional income.
What Is a Car Title Loan?
A car title loan is a specific kind of secured installment loan. Car title loans are secured through the equity value of your car used as collateral. When a loan is secured rather than unsecured, it means that the risk posed to a lender by a poor credit score is minimized. This allows the requirements for approval to be slightly more flexible.
Max Cash® Title Loans, well-versed in the title loan industry, can give you a run-down of everything you need to know about car title loans, how they work, and what requirements you need to be able to qualify for one!
How Car Title Loans Work
Car title loans have a super simple lending process. Here, at Max Cash Title Loans, we believe the best decisions are well-informed ones. So, to make sure you have all the information you need, we will walk you through the entire process from beginning to end so you know exactly what to expect.
The requirements for a car title loan are simple. Here is what the process for car title loans looks like from start to finish:
Firstly, to see if you qualify for a car title loan, you will need to fill out a simple online inquiry form and then send in some important documentation. After talking briefly with a title loan agent, you will be notified if you are approved for your loan.
Secondly, once you qualify, you will hand over the title of ownership to the lender. Then, they can place a lien on it to secure the loan by claiming it as collateral. The title will still be in your name. And even though the lender keeps the title throughout the life of the loan, you get to drive off in your car like normal after picking up your money.
Thirdly, as long as you continue making your scheduled monthly payments according to the terms agreed upon in your loan contract, then you get to keep driving your car as you usually would until the loan is finished.
Lastly, after you’ve paid down the balance of your loan in full, the lender will immediately remove the lien that they placed on your vehicle’s title and return it to you free and clear!
Max Cash Title Loans does everything they can to make the process as simple as possible for you. Loan agents can take research off your shoulders. That way, you can be connected with the right lender that gets you the most competitive rates and terms in the business.1
Requirements for Car Title Loan Qualification
With a car title loan, it is not required that you have a perfect credit score to qualify. Max Cash Title Loans understands that this simple number doesn’t define you. There are other aspects that can assure lenders of your ability to repay the loan! Since car title loans use your car to secure the loan, the requirements are more basic and straightforward than other loans.
The most vital determining requirements for qualifying for a car title loan are:
- Vehicle Equity
You must have positive equity in your vehicle in order to qualify for a car title loan. And the positive equity must be enough to secure via collateral the amount you are approved for. How much positive equity in your car will determine whether you will qualify and how much you can qualify for. The vehicle of the car must be owned by you with your name on the free and clear title.
- Ability to Repay the Loan
The other most important requirement for qualifying is your ability to repay the car title loan in full through monthly payments. Instead of just using your credit score for approval, title loan lenders focus on your income as a whole. This includes unconventional kinds to ensure that you will be able to afford the monthly payments required.
Required Documents for a Car Title Loan
After you initially fill out the first online form at Max Cash Title Loans’ homepage, you will be asked to send in some documents. These initial documents are required for car title loan approval.
These documents are standard for loan approval and will likely include:
To verify your identity and your age, you will need to provide some kind of official photo identification. This can be any kind of government-issued documents like a driver’s license, passport, military ID card, or other state-issued ID.
Proof of Income
You need to show your ability to repay the loan through proof of income. This can be done through a variety of documents such as: pay stubs, pension or social security statements, billing invoices, or tax documents.
Proof of Residence
You will need to provide proof of residence to your title loan lender. These types of loans are not available in every state! Therefore, you will need to verify that you live in the state where you are attempting to obtain a title loan. For this you can use a utility bill, a bank or credit card statement, a certificate of voter registration, or a lease agreement.
Title of Your Car
The title of ownership to your car is necessary for the loan terms to be secured. The title must be in your name and currently be free and clear! Then, the lender can place a lien on it for the duration of the loan.
Find out if You Meet the Requirements for a Car Title Loan Today
See if you qualify today by filling out Max Cash Title Loans’ simple online inquiry form!