Can You Get a Title Loan on a Financed Car?

If you are in a financial bind and need quick access to cash, you may be wondering: can you get a title loan on a financed car, or a vehicle not completely paid off? The good news is that it is possible to obtain a title loan on a financed car. We will explore the process and considerations for getting a title loan on a car that is not fully paid off yet.

Title loans are a type of secured loan where the borrower uses their vehicle as collateral. These loans allow individuals with poor credit or limited borrowing options to access funds. Traditionally, title loans have been associated with vehicles that are fully owned. However, many lenders now offer title loans on financed cars as well.

Process of Applying for a Title Loan

To understand how this works, let’s delve into the process. When you apply for a title loan on a financed car, the lender will assess the value of the vehicle based on factors such as its make, model, year, mileage, and condition. The loan amount you can receive will typically be a percentage of the vehicle’s appraised value.

It’s important to note that when you have a financed car, there is typically a lienholder involved. The lienholder is the financial institution or lender who provided the loan to purchase the car. To get a title loan, you will need to work with a lender who is willing to pay off the existing loan and replace the lienholder with themselves. This process is known as refinancing the lien.

The key factor in obtaining a title loan on a financed car is having sufficient equity in the vehicle. Equity refers to the difference between the current market value of the car and the amount owed on the loan. If you have significant equity in your car, it increases your chances of getting approved for a title loan.

Inquire About Title Loans from Tio Rico

When considering a title loan on a financed car, it’s crucial to carefully review the terms and conditions of the loan. Title loans often come with high-interest rates and short repayment terms. Additionally, failing to make timely payments can result in the repossession of your car by the lender.

It is possible to get a title loan on a financed car. Lenders who specialize in title loans for financed vehicles can help you navigate the process and refinance the existing lien. To learn more about our auto title options, contact us at Tio Rico today!