A car title loan allows a low-income borrower to acquire loans even if they have a poor credit history. It is a short term loan according to which the vehicle of the borrower can be used as collateral. The sole owner of a car can be granted a loan for the time frame of usually less than 30 days.
Car Title Regulations
Car title loans help you in getting quick cash in times of extreme emergency. However, there are interest rates and APRs imposed. And if you are unable to pay back the loans, you might end up forfeiting your car. This results in the lender’s permanent ownership of your “transportation”. There are different laws in various states of the United States regarding the title loans. Some states enforce limits on such loans while others require the car title loan lenders, who have repossessed your car and sold it, to pay the borrower the difference in the price obtained and the actual loan. There are also some state laws that allow the lenders to keep the full amount obtained from the sale of the car. This blog post is about the laws enforced by the City of Houston on all credit access businesses.
Code of Ordinances Regarding Auto Title Loans in Houston, Texas
The Code of Ordinances related to the credit access businesses, alternatively car title lenders and payday, got amended on 1st July 2014 to protect the customers. Here is what the credit access businesses are required to do:
- Register and renew it every year from the “Administration & Regulatory Affairs Department – Commercial Permitting and Enforcement Section”, City of Houston
- Maintain proper records of credit extensions obtained by the consumers.
- Maintain a prior agreement between the consumer and credit access businesses in hardcopy – renewals and refinances included.
- All quarterly reports are supposed to be filed to the commissioner of Texas consumer credit.
- Should not go beyond 20% of the gross monthly salary when the extension is issued regarding consumer credit in case of late presentment.
- Should not go beyond 70% of the motor vehicle’s retail value or 3% of the gross annual salary when the extension is granted in case of an auto title loan.
- The repayment in the form of installments shouldn’t be payable in greater than four installments. Furthermore, consumer credit extension which allows settlements in installments may not be renewed.
- Consumer credit extension may not be renewed for more than three times on the repayment of a single lump sum.
- Each agreement between the borrower and the lender must either be devised in Spanish or English.
- The consumer must be read the agreement, proper disclosure and law notices in the preferred language of the consumer.
Let Advantage Finance assist you in your time of need. While banks do not make short term loan agreements, Advantage Finance ascertains that you do not just get the loans, but also advises you with regards to the extension of consumer credit. To acquire Houston car title loans, call at 281-410—5337.