Is your low credit score making it hard to get a loan? Are banks and traditional lenders constantly turning you down? You’re not alone—many people in Georgia struggle with bad credit, but that doesn’t mean they don’t have options. This article will explain how title pawns work, especially if you don’t have good credit, and why they could be the right choice for your financial needs.

So How Do Title Pawns Work For Those With Poor Credit?

Title Pawn Basics: Emergency Loans For People With Bad Credit

Millions of Americans have poor credit, but even with a low FICO score, you can still apply for title pawns and borrow up to $15,000. That’s because title pawns are a type of secured loan, meaning you offer your car title as collateral instead of relying on your credit score.

What Makes Title Pawns Different?

Before approving a loan, lenders have to consider their credit risk, or the chances that the borrower will pay the loan back. There are two ways of managing their risk, which correspond to two types of loans: unsecured and secured.

Unsecured loans are loans granted based on creditworthiness. The borrower has established a track record of paying bills on time, does not have a lot of accumulated debt, and has many years of experience taking out different kinds of credit and paying it off.

Secured loans are granted based on collateral, which is any property of value that serves as a form of security. This type of loan may require a credit check but is less dependent on credit scores.

Title pawns are secured loans where you offer the vehicle title as security for the loan. During the duration of the loan, a lien is placed on the title. Lien simply means a legal claim to retrieve the property if the borrower defaults. It is immediately lifted when the loan is paid off.

You Can Still Use Your Car With A Title Pawn

There is an ongoing misconception that you surrender your car when you get a title pawn—largely because of the word “pawn” and how it’s associated with pawn shops where you surrender your jewelry, watch, or other property and only get it back after paying off the loan.

This is not true and comes from not knowing how title pawns work. A lien is simply a legal claim if the loan agreement is not kept. If you make the payments on time, you can continue using your car.

Simple Requirements for Title Pawns

When you understand how title pawns work, you can also realize why it is faster, more convenient, and more accessible for people who have a hard time getting a loan.

Since title pawns do not require extensive credit checks, it does not have the strict income and employment criteria of other types of loans.

For example, banks will usually refuse loans to people who have irregular or seasonal income or get their money from non-income sources like pension, alimony, government aid, or family support. With title pawns, it doesn’t matter what kind of job or income source you have, as long as you can pay off the loan.

The Vehicle Title Is The Most Important Requirement

As explained in how title pawns work, the basis of approving a title pawn is the collateral or the vehicle title. So, you have to check if your vehicle title meets the following requirements:

• The vehicle title must be lien-free. This means that no other person or organization has a legal claim on the vehicle. It is not being used as collateral for another loan, it is not being disputed in court, and there are no judgments against it.
• The vehicle title must be registered under your name. Only the legal owner of the vehicle can use it as collateral for a loan. If the title is not under your name, you need to go to the local DMV to have it transferred to you.
• The vehicle must already be fully owned. If you are still paying off the car loan, the bank still has a lien or legal claim on it because you still owe them the remaining car payments.

FAQs About Title Pawns for Bad Credit:

• Can I apply for a title pawn with no credit? Yes! Title pawns are perfect for people with no credit or bad credit, as they are based on your vehicle's value.

• How long does it take to get a title pawn? You could get approved and receive cash on the same day if you meet all the requirements.

• What if I can't repay my title pawn? Contact your lender to discuss extensions or restructuring options. Failing to repay could result in losing the car used as collateral.

Get Started on Your Title Pawn Today!

Georgia Auto Pawn, Inc. makes it easy for people with bad credit to get the cash they need. With a simple application process and no credit checks, a title pawn could be your best option for quick cash.

Contact us or fill out the online inquiry form today!

Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.