What documents do I need for a title loan?
When you’re in a pinch for cash, a title loan might seem like a viable option to help get you through a tough financial spot. However, as with any financial decision, it’s essential to be prepared and understand what you’re getting into. Knowing what documents you need for a title loan is the first step towards making an informed decision on getting a title loan. It’s very important to keep in mind title loans can have interest rates as high as 291% and get you stuck in a cycle of debt.
Here’s a rundown of the documents you might need when applying:
- Your Vehicle’s Clear Title – This is the most crucial document. A clear title means the vehicle is paid off and has no liens against it. The title must be in your name, as this shows you have the authority to use the vehicle as collateral. If the title is not clear or in your name, you’ll need to address those issues before seeking a title loan.
- Government-Issued Identification – You will need a government-issued ID, such as a driver’s license or a state ID card, which confirms your identity and matches the name on the title. Make sure your identification is current and valid.
- Proof of Residence – Lenders often require proof of residence to ensure they can contact you if needed. A utility bill, lease agreement, or mortgage statement in your name should suffice.
- Vehicle Registration – The car registration must be current and in your name. It shows the lender that the vehicle is legally registered to drive on public roads.
- Vehicle Insurance – Most title loan companies will ask for proof of insurance. This is to ensure that the vehicle, which serves as the loan collateral, is protected in case of an accident.
- Proof of Income – While you won’t necessarily need to be employed, you should provide evidence of a steady income. This can include recent pay stubs, Social Security or disability benefits, or other documents that prove you have the means to repay the loan.
- Pictures of Your Vehicle – sometimes, with online title loan applications, you may be asked to provide pictures of your car from different angles, including the interior, the odometer, and the VIN number.
Every lender is different, and some may require additional documentation. The above checklist covers the general documents you’ll likely need when applying for a title loan.
Remember, it’s imperative to borrow responsibly, ensuring you fully understand the terms of a loan and your ability to repay it. As tempting as it is to go for quick cash, make a considered decision.
How much do title loans cost, though?
It’s recommended you consider the costs associate with title loans as they generally come with high interest rates. Consider these costs versus Yendo, for example:
The Yendo Card
Yendo is the first credit card that’s backed by the value of your car.
The card can provide access to credit for those who might not be able to qualify for other credit cards. It’s a real credit card, powered by Mastercard, that provides credit limits from $450 – $10,000, depending on your value of your car amongst other factors, that can provide people with access to ongoing funds.
So, rather than having to re-apply for title loans, for example, you can access funds up to your credit limit on an ongoing basis and, with responsible usage like on-time payments, build your credit too.
Features & benefits
- Credit limit – access up to $10k in credit
- App – the Yendo app let’s you manage your account, wherever you are
- Virtual card – access a portion of your credit limit prior to getting your physical card in the mail with the Yendo virtual card. You can continue to use your virtual card even after your physical card arrives as well
- Cash advances – ability to do cash advances on your card
- Credit building – with responsible usage, you can not only have access to ongoing credit, but also build your credit for potential future financial options
Disclaimer: Yendo is not a provider of financial advice. The material presented on this page constitutes general consumer information and should not be regarded as legal, financial, or regulatory guidance. While this content may contain references to third-party resources or materials, Yendo does not guarantee the accuracy or endorse these external sources.
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Annual fee is $40. Annual Percentage Rate is a fixed 29.88% for purchases. Cash advances accrue interest at 29.88% APR and have a 3% fee. Foreign transactions incur a 3% fee. Balance transfers incur a 5% fee. A one-time lien placement fee up to $20, which is paid to your state of residence, will be charged on your first monthly statement.
Title and Payday Loan information in the Comparison tabled is based on the following CFPB Reports (1)(2). The comparison table assumes (i) a typical single installment title loan agreement is renewed each month for a total of twelve months; (ii) all accumulated interest and fees are paid on each extension date; and (iii) the loan is paid in full at the end of 12 months.
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