If you need cash right away, one of your best options is applying for a title loan. A title loan, also known as a car title loan, is a secured loan that allows you to borrow money by using the title to your vehicle as collateral.
Unlike traditional personal loans, title loans are processed quickly, so you won’t need to wait weeks to find out if you are approved. Plus, the eligibility requirements for title loans are different from the eligibility requirements for traditional personal loans. In other words, you may still qualify for a title loan even if you don’t qualify for a traditional loan due to your credit.
You’re probably wondering, “How much can I get for a title loan?” It depends. Title loan amounts can range from $2,510 to $50,000. However, the amount you are approved to borrow will depend on a number of different factors, including:
- Your Vehicle’s Resale Value
- Equity in Your Vehicle
- Type of Vehicle
- Where You Live
- Your Income
Your Vehicle’s Resale Value
How much your vehicle is worth has a major impact on how much you can get for a title loan. This is because your vehicle is used as collateral to support your title loan, so the lender needs to know how much it is worth before deciding how much you can borrow.
Your lender will calculate your vehicle’s resale value during the application process. They may do this by examining pictures of your vehicle or by inspecting it in person. Either way, the title loan company will consider several factors when calculating your car’s resale value, including:
- Make/Model: Makes and models that are in high demand or manufactured by high-end, luxury automotive companies may be worth more.
- Year: Every car loses value as it gets older. In fact, a car loses about 60% of its original value within the first five years. The older your vehicle, the lower its resale value may be.
- Mileage: High mileage indicates that there is a lot of wear and tear on your vehicle, which can lower its value.
- Condition: Regularly changing your oil, rotating your tires, and replacing filters can keep your car in good condition and increase its value. However, poor maintenance, scratches, dents, and other signs of visible damage can decrease its value.
- Trim Level: Base trim levels, which are not built with extra features or equipment, are not worth as much as higher trim levels.
Your lender will take all of these factors into consideration when determining how much your car is worth. You cannot borrow more than your vehicle is worth. Most lenders will allow you to borrow up to a certain percentage of your vehicle’s resale value.
Equity in Your Vehicle
Your equity in your vehicle also has a significant impact on how much you can get from a title loan. Equity is defined as the difference between how much your vehicle is worth and how much you still owe on it.
For example, say your vehicle has a resale value of $15,000 and you owe $5,000 on it. This means you have $10,000 in equity in your vehicle ($15,000-$5,000=$10,000).
However, say your vehicle is worth $5,000 and you owe $7,000 on it. This means you have negative equity, or no equity, in your vehicle.
But what if your vehicle is completely paid off? In this case, your equity is equal to your vehicle’s resale value. So, if your vehicle is worth $10,000 and you don’t owe anything on it, you have $10,000 of equity.
You must have equity in your vehicle in order to qualify for a title loan. Furthermore, you cannot borrow more than the value of your equity in your vehicle. This is why knowing how much equity you have in your vehicle can help you estimate how much you will be able to borrow with a title loan.
Type of Vehicle
The type of vehicle you use as collateral can impact how much you are able to borrow. Many people use the title to their sedan, SUV, pick-up truck, van, or other passenger vehicle as collateral. However, some people choose to use the title to a motorcycle or RV as collateral instead.
RVs are typically worth more than standard passenger vehicles. As a result, you may be able to borrow more money if you choose to use the title to your RV as collateral.
Using the title to your motorcycle as collateral could have the opposite effect. Most lenders cap title loans for motorcycles at around $4,000. If you need to borrow more than this amount, you may want to use the title for your passenger vehicle instead, if that’s an option.
It’s important to note that some title loan companies may not accept titles to motorcycles or RVs as collateral. Be sure to check with your title loan company before making this decision.
Where You Live
Your state of residence can impact how much you can get from a title loan, too. Why? Some states have laws that establish minimum and maximum title loan amounts.
For example, the maximum title loan amount in Illinois is $4,000 or up to 50% of the borrower’s monthly income. In New Hampshire, the maximum amount is $10,000. These are just two examples, but many other states have similar laws in effect.
All title loan companies must comply with these laws when doing business with borrowers in these states. If you live in one of these states, these laws could impact how much you are able to get from a title loan.
Your Income
Your lender will ask you to submit proof of income in the form of recent bank statements, pay stubs, or tax returns during the title loan application process. This gives your lender the chance to verify that you have a reliable source of income you can use to repay your title loan.
It also allows the lender to evaluate your income to determine how much you can afford to repay. No lender wants to let you borrow more than you can afford to repay, so this analysis will impact how much you can get from your title loan.
How Can I Find Out How Much I Can Borrow With a Title Loan?
As you can see, there are many factors that can impact how much you are able to borrow with a title loan. Fortunately, you don’t need to figure this out on your own. If you want to find out how much you can borrow, simply contact I Need Cash Now for a title loan quote. Here’s what to do:
- Contact us. Call 855-713-6522 or fill out the form on our website to get in touch with one of our loan officers.
- Provide some basic information about your vehicle. Your loan officer will ask you about your vehicle’s make, model, year, mileage, and condition. This information will be used to prepare your quote, so it’s important to make sure it’s accurate.
- Your loan officer will provide you with a free quote. This quote will tell you how much you can borrow in addition to other details about your loan, including the interest rate and payment amount.
It only takes a few minutes to get this information from I Need Cash Now. If you’re happy with your quote, your loan officer can guide you through the simple process of finalizing your loan application. The cash you need is just one phone call away–contact us today.
