Car title loans are a fast and easy way to use the equity in your vehicle to borrow money without the need for good credit. A common question when considering a title loan is: how much can you borrow with a title loan?
The answer is it depends. This post will show you how to figure out how much you can borrow with one of these loans, before you apply online.
Title Loan Amount Factors
To answer the question we need to understand what the question depends on Car title loan amounts are based on several factors. These factors will determine how much you can borrow with a title loan. These include:
- Vehicle Value – perhaps the most important factor
- Ability to repay – important factor, does not have to be from a job
- State limits – some states have caps on the loan amounts
- Lender limits – some lenders have limits on the loan amount
To figure out how much you can borrow with a title loan the first step is to figure out how much your vehicle is worth.
Vehicle Value
As mentioned the primary factor in determining how much you can borrow with a title loan is the value of your vehicle. There are numerous factors that contribute to the value of your vehicle, including:
- Year
- Make
- Model
- Mileage
- Condition
- History
Rather than go into a detailed explanation of how each factor weighs into determining the cost, we’ll simply point out the fact that there are several free tools online that will give you your vehicle value. To get an accurate value, you’ll need to provide accurate inputs. Getting these inputs is what we’ll focus on.
- Year, Make, Model, Milage – these are easy and straightforward. Simply take a look at your registration and odometer and enter the corresponding values.
- Condition – this one is a bit more subjective. Kelly Blue Book has a good explanation of what each condition (good, very good, excellent) equates to. Follow their guide to determine the condition of your vehicle.
Be honest about the condition of your car. Don’t try to categorize it as something its not. At this point don’t worry about history unless you’re certain there is something serious like salvage history or an odometer discrepancy.
How Much Will a Title Loan Give You?
Now that you have a fairly accurate vehicle value it is time to answer the question ‘how much will a title loan give you’. The general answer is 50% of the vehicle’s value. Use the following chart to help figure out how much you can borrow with a title loan:
| Vehicle Value | Title Loan Amount Range |
|---|---|
| $2,000.00 | $100.00 – $1,000.00 |
| $5,000.00 | $1,100.00 – $2,500.00 |
| $7500.00 | $2,600.00 – $3,750.00 |
| $10,000.00 | $3,800.00 – $5,000.00 |
| $15,000.00 | $5,100.00 – $7,500.00 |
| $20,000.00 | $7,600.00 – $10,000.00 |
| Over $20,000.00 | $10,000.00+ |
Ability to Repay
The next factor in determining how much you can borrow with a title loan is the ability to repay the loan. Unlike an unsecured loan, credit score is not a major factor in this determination.
It is, however, required that you have the ability to repay the loan. Even though the loan is secured by the vehicle, it still does not do any one any good to make a loan that cannot be repaid.
Repayment Forms
The repayment of a title loan can be from any form of future income. Probably the most common way to demonstrate ability to repay is by providing pay statements. This doesn’t mean you need to be employed to get a title loan, but you do need to have the ability to pay the loan back.
Other forms of income for paying back title loans include annuities, retirement income, commissions, tax refunds, and any other source of reliable funds. It is possible to get a title loan without income verification.
Title Loan Amount
To determine the title loan amount we need to look at both the vehicle value and the ability to repay the loan. This means getting an idea of how much the title loan will cost. You can contact a few lenders and ask for a quote and and estimate for the loan amount.
You can also use the title loan estimate calculator to get an idea of the loan cost. This provides both the monthly payment and the total loan cost.
Use the table in the previous section and find the loan amount that aligns to your vehicle value. Then make sure you have the ability to repay that amount. If not, adjust the amount down until you have a number that you can repay and that your vehicle value will support. You now have an estimate on how much a title loan will give you.
Summary
How much can you borrow with a title loan? Generally, 50% of the vehicle value assuming you can repay the loan. Simply value your vehicle to get an idea of how much a title loan will give you.