Why wouldn’t I qualify for a car title loan?
There are two main requirements for a car title loan:
- First, applicants must have a certain amount of positive equity in their vehicle to borrow.
- Second, an applicant must demonstrate that they have the ability to afford a title loan and repay it.
With these two qualifications in mind, it is easy to understand what disqualifies a candidate for a title loan. The simple answer is that an applicant can be denied a car title loan if they don’t have enough equity in their vehicle to borrow, or if they can’t prove they can afford the loan. ready. If an applicant does not have a qualifying vehicle or income, they cannot receive the money they need through an online title loan.
But, what are the other reasons why an applicant may not be approved for a car title loan? Look more closely!
What can disqualify an applicant for a title loan?
So what disqualifies a candidate for a title loan? Before you can understand why a candidate may not be approved, it is important to understand how it works. Securities lending are short-term installment loans that allow you to use your car as collateral for financing. The car title is collateral for the loan, allowing you to access some of the equity in your car and turn it into cash.
Since the car is used as collateral for the loan, that is why the amount of equity is so important. The value of your car will determine your eligibility for the loan, as well as the potential loan amount. Typically, claimants can receive 25% to 50% of the value of their car, depending on:
- Their state of residence
- And their income/ability to repay the loan
Now that you know how title loans work, you may be able to understand how an applicant could be disqualified for a car title loan. Here are some of the main reasons a borrower could be disqualified:
- Their car does not have enough positive equity: Equity is the difference between the present value of the car and what is due. If you owe more than the car is worth, or if it is in poor condition, you may have negative equity and will not qualify for a car title loan.
- A lien is already placed on the car: If an applicant already has a lien on the car from an existing title loan, they may not be able to qualify for a title loan. However, if the applicant has only a few payments left, they may be able to get their current loan refinanced if they are not satisfied with their terms.
- Inability to repay the title loan: A borrower will need to have enough income for a lender to reasonably believe they can afford the loan. If a borrower is receiving disability benefits or is self-employed, they may still qualify for a car title loan, but they must have the confidence of the lender that they can afford it.
What do I need to qualify for a title loan?
If you are confident in your ability to repay a title loan, you may be wondering what you will need to qualify. Like any loan, you will need to provide some documents when you apply for the loan, which will notably prove your identity. Here’s what you’ll typically need to qualify for a car title loan:
- Proof of income through bank statements, pay stubs, etc.
- Proof of address by recent official mail, such as a utility bill
Now that I know what disqualifies a title loan applicant, how do I apply?
If you’re like most Americans, you appreciate the convenience of shopping online. You can do so much shopping online! Grocery shopping, buying clothes, and even buying a car can be done through your smartphone or computer. So why not apply for a car title loan online?
With some online securities lending options, it is possible to initiate your request via your smartphone or computer!
So why wait to see if you qualify for the financial assistance you need? With loan options like ChoiceCash title loans powered by LoanMart, you can access a convenient 3-step application process through your phone today. Just visit the website to get started and place your loan application online! Call 855-914-2945 to learn more about the title loan process and what you need to qualify.