What You Should Know About A Car Pawn Loan
There are a lot of misconceptions going around about car pawn loans. People think that they have to give up their car, or that it’s difficult to get approval. On the other hand, when they hear that it’s one of the easiest loans to get, they automatically think that it’s a scam.
Any financial decision needs to be based on facts. Here’s what you should know about car pawn loans (also known as car title pawns) so you can decide whether it’s the right option for you.
Things To Know About Car Pawn Loans
A Car Pawn Loan Is A Kind Of “Secured Loan”
There are two types of loans: unsecured and secured loans.
Unsecured loans are approved based on your credit history and financial capacity. Lenders will set a minimum credit score (which measures your ability to make payments on time and handle different types of credit), as well as income and employment requirements.
Secured loans are approved based on collateral, or any property or value which acts as a loan guarantee. A car pawn loan falls under this category: you use your vehicle title to secure the loan.
You Can Get A Car Pawn Loan Even If You Have Bad Credit
It’s really hard to get an unsecured loan since banks require a minimum credit score of at least 560 to 600.
However, with a car pawn loan, you can apply even if you have a low score or haven’t been able to establish a credit score because you’ve never taken out a loan before. You just need to have a vehicle that you can use as collateral.
You Can Still Use Your Car During Your Car Pawn Loan
When people see the word “pawn” they think of traditional pawnshops where you leave the item with the lender until you can pay back the loan.
However, a car pawn loan is different. Instead of taking the vehicle, the lender places a “lien” on the car title. A “lien” is just a legal right over the property in case a borrower doesn’t meet the loan obligations.
So, as long as you make the payments, you can use your car just like you always have. The only limitation is that you can’t sell it until the loan is completed or use it as collateral for other loans. Then, when you’re done with the payments, the lien is lifted.
You Need To Own The Car Outright
One of the most common questions people ask is “Can I use a car title pawn even if I’m still paying off my car loan?”
The answer is no. When you get a car loan, the bank places a lien on the title until you completely pay it off. So, you can’t use it as collateral for another loan.
You Need To Be The Registered Owner Of The Vehicle
It would be pretty dangerous if anyone could take a title and then use it to get a loan.
That’s why the laws are very strict about proving that you are the legal owner of the vehicle. Your name has to be on the car title, and you have to show a government-issued ID with a photo.
If the car is not under your name, or there was a clerical error and your name was misspelled and doesn’t match your ID, you have to go to the DMV to have it fixed.
You Can Borrow Up To $15,000
A car pawn loan can help pay for large, unexpected expenses like medical bills or house repairs. You can borrow up to $15,000 depending on your vehicle’s brand, model, and overall condition. That’s a lot bigger than most personal loans, which usually have low loan limits.
You Can Apply For A Title Pawn Online
You don’t have to line up at a bank to apply for a car pawn loan. Georgia Auto Pawn, Inc. has a very convenient and fast application process that you can start right now!
All you have to do is fill out the online form. Your contact info is then sent to our loan representatives from the nearest branch. We will then call you so they can personally explain more about the car title pawn and answer your questions.
Then, you just have to go to the local title pawn branch to show your vehicle title and ID and get a ten-minute vehicle inspection. The rest of the approval process, including signing the documents, is then finished typically in less than 30 minutes.
Get Started Today
Once the car pawn loan is approved, you get the money the same day or the next business day. It’s one of the fastest ways to raise emergency cash—and the entire process is easy and stress-free. Hopefully this fills in the gaps on what you need to know about car pawn loans. They are a great option when you need fast cash.
So, if you face a financial emergency and you need to get a loan, fill out the online form and start your application. Help is on its way.
Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.