Are you in need of a loan for an unforeseen circumstance in your daily life? Perhaps you just hit a rough patch and need a little extra cushion to climb out of it? Whatever your reason for needing a loan you may be able to turn to your vehicle to help out the situation by making the right choice and learning some car title loan laws.
What is a Car Title Loan?
A title loan is basically a way to borrow money using the equity on your car. These types of loans are much easier or people to get than a regular or basic bank loan. Even if you have poor credit or a bankruptcy and are currently unemployed a title loan may just be the answer you’ll need to better your situation or save the day in case of an emergency.
Requirements differ from state to state and also depending on the lender’s stipulations. The lender will assess your car’s value and a couple other factors to determine the interest rate of your loan and the amount they are willing to loan you.
Top Laws to Know
One of the most basic requirements is that you 18 years of age or older.
You’ll also need a lien free vehicle to borrow against.
Some states limit the amount you can borrow against your car. For instance, New Mexico caps the amount at $2,500.
Each state has different laws when it comes to repossession. Some states have to wait at least 10 days after you default on a loan payment. Other states can take your car from you immediately. There are other states that allow the lender to extend your payment requirement for 20 days, and some states will allow you to repay the missed payment and acquire your car back after it has been taken or repossessed.
Just make sure you check your state’s statutes first. One last thing to keep in mind when it comes to repossession laws is that a lender can repossess and sell your car and still charge you fees for storage and any fees during the repossession process. Additionally, if they do sell your car for more than what you owed on it the lender is not required to pay you back the difference or extra money from the cars’ sale.
23 states consider car title loans legal and four others such as South Carolina, Louisiana, California, and Kansas have developed loopholes in their state statutes that do allow for car title loans to happen. You also should also take into account that these laws and citations change somewhat frequently so it’s important to do your due diligence before embarking on the car title loan process.
Some states will require that your car is equipped with a remote immobilizer and or a GPS tracking device.
Above are the basic laws you’ll need to be aware of when considering getting a car title loan and arm yourself with the correct knowledge to make for the most successful situation to your daily life.