Car Title Loan Requirements - What you need to get a Title Loan Online
Car title loans, like all loans, have specific requirements borrowers need to meet to qualify for the loan. Additionally, following qualification or approval, there are some requirements to meet prior to loan funding.
These requirements can, and do, vary from state to state and also from lender to lender. This makes it important to check with your lender to make sure you meet their specific requirements for a car title loan.
What most title lenders won’t tell you is that some requirements are hard and not negotiable, and others can be waived. Knowing which requirements can be negotiated or waived is important.
Fast Title Lenders prefers clear and straight forward requirements, without adding complexity to the process by requiring unnecessary and/or complicated items like warranties or GPS devices.
These types of requirements usually add to the cost of the loan without providing any real benefit to the borrower. Our goal is to provide borrowers with with knowledge needed to get the best car title loans possible.
General Title Loan Requirements
Car title loan requirements can be broken into two categories: general and specific. Specific requirements can be driven by both the state and the lender.
Because car title loans are secured by the vehicle, the requirements are usually easier to meet than other traditional loan requirements.
For example, credit history does not play a large role in a title loan like it does for most other loans. In fact, it is possible to get a title loan with no credit check.
The specific title loan requirements are determined by two factors: the state where you are getting the title loan and the specific lender. A title loan in Miami Florida, for example, will have different requirements than the same title loan in California or Texas.
All title loans have some general requirements in common, we will cover these first. Consistent and common requirements to qualify for the loan include:
- A vehicle with equity
- Lien free title
- Valid Drivers License
- Proof of Insurance
- Proof of Income
Each car title loan requirement is explained in more detail below:
Requirement 1 - Vehicle
The vehicle is a key requirement for getting a title loan for obvious reasons. To obtain a title loan you will need to own a vehicle with enough equity to support the loan.
This is at the center of how title loans work. In some cases you can get a title loan without the car. You will need to own and have access to the vehicle in these cases.
Different lenders have different requirements for the vehicle, and many have year cutoffs. The reason is vehicle value. This is true for both in-person and online title loans.
Some lenders will lend on any vehicle; but if the vehicle has very little value the loan may end up being very small ($100). In these cases, a Payday or similar loan may make more sense.
Fast Title Lenders does not not agree with arbitrary year cutoffs. We think the vehicle value is more important than the year. This is particularly important for those with collector or classic cars. If a vehicle has value, we believe it is a candidate for a title loan.
Requirement 2 - Lien free Title
In most cases to qualify for a title loan you will need to own your vehicle free and clear. This means the title must be free of liens; meaning there are no existing unpaid loans.
If you recently paid of a loan, check with the lender or finance company to make sure they released the lien. It may be possible to get a title loan while still making payments on a vehicle if you have enough equity.
In some cases, you may be able to get a title loan without a lien free title. These cases include having a vehicle that is almost paid for, a title loan refinance, and a 2nd lien title loan.
Requirement 3 - Valid Drivers License
The lender will need to verify your identity to make the title loan. The easiest way to do this is by requiring a valid drivers license. Make sure your license is current and not expired.
Requirement 4 - Proof of Insurance
Most title lenders do require proof of insurance. Some lenders require comprehensive insurance, others do not. This is similar to what a lien holder requires when you purchase a new or used vehicle.
This way, if the vehicle is stolen or involved in an accident, the insurance company will cover the costs to repair or replace the vehicle.
If you do not currently carry full coverage insurance you can add it easily, usually with a simple phone call. You can also ask for this requirement to be waived if the loan size is small.
Requirement 5 - Proof of Income
Some lenders require proof of income to make a title loan. The simple reason for this is to verify the ability to repay the loan. If the borrower has no means to repay the loan, then it will likely not end well.
You can get a title loan without income verification, but you will still need to have some way of repaying the loan.
Additional Requirements:
There are some additional car title loan requirements that are specific to either the lender or the state the loan is initiated in.
In some states, lenders may also require you to purchase an automobile warranty and/or roadside assistant policy from them. We would caution anyone entering into a loan with these types of additional purchases.
The additional purchase requirements can to be very costly and, in many cases, may be unnecessary. We have also seen some lenders require a GPS device be installed in your vehicle.
Additionally, title loans for motorcycles may have slightly different requirements depending on the specifics.
Title Loan Requirements by State:
Car title loans are regulated at the state level and different states have different requirements and regulations related to title loans. For example, the maximum loan amount is often dictated by the state.
Some states have low maximum amounts and others have no maximum (other than as a percentage of the vehicle value). The difference between states can cause confusion.
The requirements can sometimes drive lender based requirements. Some states allow only one title loan at a time, and states with rollovers limit the number of rollovers.
Title Lender Specific Requirements:
Different lenders have different requirements for getting a title loan with them. They also have different policies related to minimum and maximum loan amounts.
For example, TitleMax usually does not lend more than $10,000.00. This is their policy and is not necessarily dictated by any regulatory body. The lender specific requirements, meaning requirements specific to a lender and not required by all lenders, include:
- A Spare Key – some lenders do require a spare key to the vehicle. This is to make it easier to repossess the vehicle should you default. You can ask for this to be waived if you do not have a spare key.
- Personal References – Some lenders require several personal references who can verify your ability to repay the loan. Because there is no credit check, some lenders require these references to help locate you and your vehicle should you default. These are typically more common requirements for online title loans.
- A GPS Device – Some lenders require you to let them install a GPS device in your vehicle during the loan period. This is so they can find it quickly should you default on the loan. The lender typically requires you to pay for the device.
- Proof of Income – the ability to repay the loan is essential. Proof of income is an easy way to verify, without a credit check, your ability to repay the loan. Most lenders do require borrowers have the ability to repay the loan.
- Proof of residence – Some lenders require proof of residence in the form of a utility bill or bank statement.
Income Requirements
The income specific requirements for getting a loan vary depending on the lender’s policies. Some lenders require proof of income, some do not. Some lenders do not require the borrower to be employed or have a source of income.
We suggest that anyone considering a title loan make sure to have a plan to repay the loan. To make sure you can afford the loan, be sure to understand the car title loan costs. Use our title loan calculator to get an estimate for any loan amount.
To help ensure your title loan is fast it is advised that you find out the requirements and gather the required documents before applying. Put them in a single file or folder and have everything ready when you apply.
This will help make the title loan process go smoothly and help get your loan funded fast. Providing the right information the first time is especially important for a rapid online title loan where the margin of error for time related delays is very small.