Can I Get a Title Loan While Still Making Payments
Many of you may be wondering whether or not you can get a title loan while still paying on a preexisting auto loan. This can be a great way to get financing when other sources dry up.
Reasons for getting a title loan vary, and they are a great option for getting financing relatively quickly. Securing a title loan when you already have a loan on your vehicle can be difficult, but it’s doable and this info will help you navigate the process.
Can You Get a Title Loan on a Car that is Financed?
Can you get a title loan on a car that is not paid off? In some cases – yes, as long as you meet the basic requirements. Mostly these requirements pertain to the financier’s estimation of your ability to repay the loan in addition to your other creditor.
If your vehicle was originally financed through a car dealership or a bank it’s can make a difference in swaying the odds in your favor. Every bit helps and the more pros you have stacked in your favor the better. Title loans can be tricky to acquire, but it’s definitely possible, especially when you have a lender open to working with you.
First Some Background Information — the Breakdown on Title Loans
Title loans are typically sought by folks who for various reasons cannot secure financing using more traditional methods. These loans are a good option for people who can’t get a more conventional loan and don’t want to wait for things to clear up.
This is a decent option when you don’t have many alternative sources of collateral to offer financiers.
Title loans can make a huge difference in solving emergency problems that come up and require getting a hold of cash fast.
Life always has a way of throwing us curve balls and taking out a title loan can free up the financing you need to handle life’s unexpected challenges.
Essentially when you take out a title loan, your vehicle will be used as the collateral. This works out for both parties as the creditor will be satisfied in having the peace of mind, and you’ll receive the financing you need.
The Key Is to Qualify
The key to tagging on a title loan while already paying on a car loan is to qualify. The short answer as to whether you can do this is yes, but you have to be able to qualify.
Some of the biggest factors in qualifying for more financing are your current credit score and past credit history. Another major factor is the amount owed on the car loan you currently have. Finally, the other major hurdle to qualifying for a title loan under these circumstances is to have sufficient income and to show the ability to pay back the loan.
The higher your income is, the less significant the remaining principal on your car loan becomes.
Financiers will look at what you owe and run it against what you make.
This income has to be regular and you’ll have to be able to show something substantial that will put the creditor at ease. Everyone remembers 2008, especially financial institutions and no one wants to repeat it either.
One possible exception to this is when the value of the vehicle greatly exceeds the remainder of the original loan. The mileage on the car will also be taken into account as vehicles with low mileage on them will improve your chances of getting financed.
After Qualifying for a Title Loan
When you get a title loan on a car that is financed, the creditor will become a lien holder on the vehicle. This is standard practice and is to be expected irrespective of which financier you work with. This protects their interests and allows you to procure financing.
It’s also going to be important to take exceptionally good care of the vehicle as the creditor will be counting on it for collateral.
If you end up not being able to follow through with paying off the loan, the vehicle needs to retain the value needed to cover the principal. Overall, however, you should concentrate on keeping up with the payments, this will, of course, ensure the best outcome for both parties.
Things to Know as a Borrower
When asking, “Can I get a title loan while still making payments?”, the most important thing to consider is your financial position. Qualifying for a title loan is only half the battle. Managing your title loan is a serious responsibility and as the principal risk holder, paying off your title loan is imperative.
Can you get a title loan on a car that is not paid off? Yes! The key after you qualify for the loan is to make sure you can keep up with the payments. Using your vehicle as collateral puts a greater sense of responsibility to pay off the loans on you.
If things go south, you do have some generous liberties available to you in the state of California. State residents have a much higher chance of actually keeping your car than in some other states. Chapter 13 will always be more flexible and give you a greater chance of retaining the use of the vehicle than Chapter 7.
Paying Off Your Loans
After you have paid your title loan and your previous loans, you can remove the liens on your vehicle. This is the light at the end of the tunnel. At this point, the vehicle will be yours free and clear.
Financing is a means to an end, and full vehicle ownership is the ultimate goal.
To meet the credit criteria applicants must be found to have significantly high chances of repaying the loan. As mentioned previously, the value of the vehicle will be taken into account.
5 Star Car Title Loans: A Leader in Title Loans in the State of California
5 Star Car Title Loans is the premier choice in sunny California for securing title loans, whether you already have a loan or not, we will always do the most we can for you. Even if your vehicle’s title is out of state, if you register the car in California, you can get a title loan in the state although some restrictions may apply.
Not all title loan companies will give you a fair deal, 5 Star Car Title Loans is fair and committed to quality service. Let us be your partner in title loans and solve your financing needs.
References:
Chapter 13 – Bankruptcy Basics
