Myths About Car Title Loans

Daniel Joelson

Daniel Joelson

Total Posts: 344

Published Date: February 9, 2024

Daniel Joelson has been in the consumer finance space since 1994, he has helped to develop underwriting manuals for the financial sector. With a vast amount of Knowledge in consumer finance, he has been writing articles for all types of loans. With his knowledge, he is able to help many people to answer different financial problems.

There are a lot of people who are thinking about getting car title loans but sometimes end up getting traditional loans. The reason behind this can be the common myths about car title loans.

Having financial issues is common and can happen to anyone. But brushing off the idea of getting title loans can count as bad decision-making. 

Title loans are way faster than traditional loans. In title loans, you have a good chance of getting a loan amount not based on your car equity rather than your credit history or credit score. This makes things simple for you and allows you to get rid of your financial issues. 

Here are some of the Myths about Car Title Loans

  • You need to leave your car to the lender when you get the loan 

This is not true. This is an old practice that was common at a pawn shop where you needed to hand over anything for purchase. But with modern online title loan providers or lenders, do not hold your car or vehicle after funding the title loan.

You can keep driving your car or vehicle while you are repaying the borrowed amount. However, ensure that you are in contact with a reliable broker like the TFC Title Loans.

  • You will get into a trap of paying the huge interest amount 

This is true that Title Loans is known to have high APRs, but this does not come as a surprise to any educated borrower. When you are getting a title loan, the terms of the title loan agreement, include the rate of interest and repayment information. We are mentioned in the contract that you need to acknowledge. Ultimately, you can end up in this trap of paying huge interest amounts if you are unable to repay the borrowed money. Try to treat title loans as short-term solutions. 

Myths about car title loans
Myths about car title loans
  • You cannot get title loans with a bad credit score or no credit history 

This is the biggest myth that a lot of people believe in. But the lenders are only interested in your Collateral which you can offer in the form of your car or vehicle. If you have a high-equity vehicle, then you can get a high loan. In case you do not pay back the borrowed money, then the lender will repossess your car. But the bottom line is that you are still eligible to apply for title loans if you have a bad credit score or no credit history. 

  • If you skip a single payment, you can lose your vehicle 

This myth is very dramatic and not true. Same-day title loan companies would not ever get any business if they are so rigid and aggressive with repossession. TFC Title Loans allow you to enjoy the benefit of refinancing if you are unable to pay the loan on time. This can offer some flexibility. 

Frequently Asked Questions About Myths About Title Loans

  1. Are title loans only for people with bad credit? Title loans are not exclusively for individuals with bad credit. While they can be accessible to those with less-than-perfect credit histories, they are also used by people who need quick access to cash, regardless of their credit score.
  2. Do title loans always lead to vehicle repossession? Contrary to common belief, not all title loans end in vehicle repossession. Repossession occurs when borrowers default on their loan payments. Responsible borrowing and timely repayments can help borrowers avoid repossession.
  3. Are title loans illegal? Title loans are legal in many states across the United States, although regulations and terms can vary widely. It’s essential for borrowers to research and understand local laws and regulations regarding title loans.

Quote from Daniel Joelson, Consumer Finance Expert: “Title loans often carry misconceptions, but they can be a viable option for those needing short-term financial solutions. It’s crucial for borrowers to separate myths from facts and carefully evaluate their financial situation before taking on any loan.”

Conclusion About Title Loan Myths

Believing in myths about title loans can stop you from enjoying the best experience of getting a loan. However, try to maintain good communication with your TFC Title Loans broker if you are facing any issues.  

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Disclosures

DISCLAIMER: As our policy to make sure you know what we do and what are our limitations, we offer you these disclaimers. We are NOT A LENDER and we do not make short term cash loans or credit decisions. We are a referral service and work only with licensed lenders/brokers.

We may act as the broker for the loan and may not be the direct lender. Loan proceeds are intended primarily for personal, family and household purposes. We do not offer or service student loans.

*Loan amounts by the lenders vary based on your vehicle and your ability to repay the loan.

*Since we do not lend money directly we cannot offer you a solicitation for a loan, except in the state of California. In all other serviced states we WILL match you with a lender based on the information you provide on this website. We will not charge you for this service and our service is not available in all states. States that are serviced by this Web Site may change from time to time and without notice. Personal Unsecured Loans and Auto Title Loans are not available in all states and all areas.

*Auto Title Loan companies typically do not have pre-payment penalties, but we cannot guarantee that every lender meets this standard. Small Business Loans typically do have pre-payment penalties and occasionally will use your car as collateral to secure the loan.

*All lenders are responsible for their own interest rates and payment terms. TFC Title Loans has no control over these rates or payments. Use of the work competitive or reasonable does not mean affordable and borrowers should use their own discretion when working directly with the lender.

*The amount of people who applied for a loan and we helped and those who received a loan is not the same. We cannot guarantee we will find a lender who will fund you.Just because you give us information on this web site, in no way do we guarantee you will be approved for a car title loan or any other type of loan. Not all lenders can provide loan amounts you may see on this web site because loan amounts are limited by state law and/or the lender. Some lenders may require you to use a GPS locator device on your car, active all the time. They may or may not pay for this or charge you for this. This is up to the lender and we have no control over this policy of the lender. Typically larger loans or higher risk loans use a GPS.

*In some circumstances faxing may be required. Use of your cell phone to receive updates is optional.

*Car Title Loans are expensive and you may have other ways to get funding that is less expensive. These types of loans are meant to provide you with short term financing to solve immediate cash needs and should not be considered a long term solution. Residents of some states may not be eligible for a loan. Rejections for loans are not disclosed to our firm and you may want to contact the lender directly.

*Car Title Loan lenders are usually licensed by the State in which you reside. You should consult directly with these regulatory agencies to make sure your lender is licensed and in compliance. These agencies are there to protect you and we advise making sure any lender you receive money from is fully licensed.

*Trading Financial Credit, LLC dba TFC Title Loans, Car Title Loans California, Dineromax. If you are using a screen reader and are having problems using this website, please give us a call at 1-844-242-3543 for immediate assistance.

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