Truck title loans

Using your truck’s title as collateral could get you more money than a car — they’re typically more valuable. But larger short-term loans can be difficult to repay — especially with APRs easily topping 300%. And you risk losing your truck if you default.

How do truck title loans work?

Truck title loans work a lot like any other type of title loan: You take out a short-term loan using your truck’s title as collateral. This means you can continue to drive your truck while you’re paying it off.

How much you can borrow depends on two factors: the resale value of your truck and the loan-to-value (LTV) ratio your provider offers.

Truck title loans generally run from $100 to $50,000. But even if your truck is worth $50,000, you generally can’t borrow against the full value of your vehicle. LTV ratios vary by lender — and most don’t advertise them.

Truck loans can be larger than your typical car title loan, so you may have longer to pay it back than other title loans, sometimes up to three years.

Semitruck title loans

While you could get a loan secured by your pickup from any car title loan company, not all offer loans backed by titles for semis or other commercial trucks. If you’re looking for financing secured by a commercial vehicle, you might want to look into lenders that specialize in this. Some also allow you to back your loan with other heavy equipment.

How do I get a truck title loan?

With most truck title loan providers, you can get started on your application online or over the phone. But you typically need to bring your vehicle in for an inspection along with your title and other documents before you can get your funds.

Once you submit your online application, a representative typically reaches out to you with instructions for how to proceed and which documents to bring.

Am I eligible for a truck title loan?

You don’t need to have good credit — or sometimes even a job – to get a truck title loan. And while requirements vary depending on your lender and your province or territory, you typically need to meet the following criteria:

• Lien-free truck title in your name. You generally can’t get a truck title loan if you’re already using it as collateral for another loan. If you are, consider an auto equity loan instead.
• Steady income. You don’t need to be employed to get a truck title loan, but you need to have money coming in from a pension, government benefits, child support or somewhere else.
• Age of majority. You need to be at least the age of majority of your province or territory.
• Live in the same province as the lender. Some title loan providers won’t allow you to borrow against your truck unless you can prove your province of residence with a utility bill, copy of your lease or mortgage or other documentation.
• Proof of insurance. Lenders sometimes require you to provide proof of insurance with larger title loans.

How much is my truck worth?

What are the benefits of truck title loans?

From fast funding to lenient credit requirements, here are a few perks of truck title loans:

• All credit types accepted. You don’t necessarily need to have a strong credit score to get a truck title loan.
• Borrow more than a car title loan. Since trucks are often worth more than cars, you might be able to take out a larger loan.
• Potentially get funds the same day. You might be able to get your money in as little as 30 minutes if you apply in person.

What to watch out for

Consider these potential drawbacks before taking out a truck title loan:

• High rates. Like all short-term loans, title loans come at a high-cost.
• Longer terms. The longer your loan term, the more time there is for interest to add up. Combined with high rates, this means you could end up paying multiple times the amount you borrowed in interest.
• Could lose your source of income. If you depend on your truck for work, you run the risk of losing your source of income should you default.

What happens if I don’t pay back a truck title loan?

You could lose your truck if you don’t pay back a title loan — the lender is entitled to repossess it and sell it to cover the cost of your unpaid loan.

How and when your lender repossesses the vehicle depends on where you live. Most provinces have laws that outline the process lenders must follow when it comes to repossessing vehicles. Typically, lenders are required to give borrowers an installment plan to pay off the debt first before repossession.

Bottom line

A truck title loan is a quick way to borrow an even larger amount than you can with a standard auto title loan. But should you default, you risk losing your livelihood if you rely on your truck for work. If that’s the case, consider alternatives or using another vehicle’s title to back your loan instead.

To learn more about how title loans work in general, check out our guide.