Can You Get a Title Loan While Still Making Payments?

Do you know that over 100 million people in the US are currently making payments on their cars, trucks, and SUVs? If you are one of them and you have taken out a loan to buy your vehicle, you might be wondering how this affects your eligibility for a title loan.

If that’s your situation, you must be eager to know if you can get a title loan while still making payments. Well, guess what? This blog is dedicated to providing you with all the necessary information you need.

How Do Title Loans Work?

The answer to this query varies. Because some lenders may allow you to secure a title loan even if your car is not fully paid off. But, and it’s a big deal, it all depends on how much you still owe to your lender and their policies (if any).

If your outstanding amount is small, you might still be in luck with that title loan because having a financed vehicle does not necessarily rule out your chances of getting title loans. However, if you still have to pay a big amount that needs to be paid off, the lender might be hesitant to grant you the title loan.

In short, individuals who have only a few payments left on their cars are more likely to qualify for a title loan. However, it is important that you understand that if you get a title loan while your car is not entirely paid off, your lender will become the primary lienholder on the car. This means that in the case of a default, the lender has the authority to repossess the car.

Tips to Consider Before Asking for a Title Loan

You now know that you can get a title loan while still making payments, but only if you don’t have a large balance to pay. However, here are some tips to consider before applying for a title loan:

1. Speak with your current lender

Make sure to touch base with your current lender before applying for a title loan application. It is wise to confirm if they permit their customers to pursue title loans. While some lenders may have strict policies against it, others might be more flexible. Checking in beforehand can save you from any surprises down the road.

2. Determine the value of your car

Want to know how much you can borrow with a title loan? It all boils down to your car’s value. If you’re still paying off your car, calculating your equity is key. Your equity is the difference between the value of your car and the debt on your loan.

Simply subtract what you owe from its resale value. Got it? Great! However, there’s one catch: If you owe more than your car’s worth, sorry, you’re out of luck. You need equity to qualify for a title loan, and the amount of loan you can borrow depends on it.

Remember: You can’t borrow more than your equity’s worth.

3. Find a lender who accepts cars with liens

Before jumping into applying for car title loans, it is important that you conduct thorough research. Not every title loan lender will accept cars with liens. Therefore, make sure you find a lender clearly stating their acceptance of cars with liens. These lenders may ask for documentation proving your car’s value and your existing loan balance.

To Sum Up

While it may have some challenges, getting a title loan while still making payments is achievable.

The key is to assess your vehicle’s value and loan equity. Once you’ve done that, the next step is to locate a reputable title loan provider to secure the loan.

Contact Advantage Finance Title Loans at (281) 410-5337; our reliable title loan services ensure swift and secure access to cash when you need it most.

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