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Finova Financial auto equity loans review
Short-term loans up to $5,000 — secured by your car title.
finder.com’s rating: 2.4 / 5.0
Finova Financial offers fast, short-term loans that your car’s equity as collateral. It’s an option if you don’t have a bank account. But convenience isn’t free. Some payment options come with additional fees, among other potential drawbacks.
Kellye Guinan is a seasoned financial writer with over 500 articles under her belt spanning all things loans from auto to personal to business and everything in between. With four years in the field and five years of research experience, she's able to make complex personal finance decisions easier for anyone to tackle. When she's not up to her knees learning about the latest trends in lending, she spends her time improving her own financial literacy and expertise — and maintaining a Duolingo streak of over 1,300 days.
How does Finova Financial work?
Finova offersshort-term loans backed by your car title as collateral. Finova’s Consumer Loan on Car (CLOC) program works by ting the details you provide in a short application about your car and financial situation to determine how much you’re able to borrow. Finova offers loans of $750 to $5,000, though terms may vary by state.
Finova Financial auto equity loans are only available to residents of the following states:
How much does a Finova loan cost?
Finova Financial auto equity loans come with APRs capped at 30%. These are included in the APR. However, other fees that might not be wrapped in the APR include:
Filing fee. This fee up to $75 covers the lien on your car.
Credit investigation fee. Finova charges a $25 fee when you make your first payment to cover the cost of checking your credit.
Origination fee. Finova might charge a $25 or $30 origination fee to borrowers from certain states.
Insurance. You need to have comprehensive and collision insurance, prepaid for the life of your loan with a deductible of $500 or less. Or, sign a voluntary debt cancellation addendum.
This can all add up to an APR well over 30%. Be sure to consider the total cost of your loan before signing the contract.
Is an auto equity loan the same as an auto title loan?
Not exactly. It’s similar to an auto title loan in that both types of loans use your car title as collateral. But Finova sets itself apart by giving you more time to pay back your loan — usually between 12 to 24 months. Still, if you fail to pay back your loan within the terms outlined in your contract, Finova can take ownership of your vehicle to satisfy what you owe.
Both types of loans are costly forms of credit, so it pays to compare your options before applying for either loan.
What are the benefits of a loan from Finova Financial?
No bank account required. Finova encourages repayments through MoneyGram, opening up the option of paying with cold, hard cash at any of its 32,000 locations — no bank account necessary.
Fast turnaround. Complete a short application, and a Finova representative contacts you to complete the process. If you’re approved, your loan can be transferred to your MoneyGram account within hours.
More time to repay. Depending on your specific loan, you’ll have between 12 to 24 months to repay what you borrow from Finova Financial, typically resulting in lower payments and an overall more manageable loan compared with traditional auto title lenders.
Bad credit is OK. Like most online lenders, Finova Financial appears to care more about your ability to repay your loan than your past bumps in your credit. Your credit score is unlikely to be the deciding factor in the approval process.
What should I watch out for?
Comprehensive and collision insurance required. You’re required to add Finova as a payee on your insurance policy in case of an accident over the life of the loan. If your policy doesn’t already include comprehensive and collision coverage, Finova offers a “debt cancellation addendum” — but, like most convenient options, for a fee.
Extra fees. Depending on your state of residence, you could be charged fees that aren’t included in your rate. Read the fine print to make sure you’re getting the loan you signed up for.
Available in select states only. Finova Financial offers auto equity loans to residents of Arizona, California, Florida, New Mexico, South Carolina, Tennessee and Oregon. If you don’t live in one of these states, you won’t be able to use its services.
Small loan amounts. You can’t borrow more than $5,000 with this lender.
MoneyGram repayment fee. If you choose to make your repayments online through MoneyGram, you could have to pay a fee each month.
Must read: A note on Finova Financial’s debt cancellation addendum
Because you’re using your car title as collateral for a loan, Finova requires you to carry auto insurance on your vehicle. Your policy must include at least a $500 deductible and coverage under your insurer’s comprehensive and collision policy that’s prepaid up through the length of your loan term.
If you carry only basic insurance, Finova requires you to take out an insurance policy — or “debt cancellation addendum” — through the company. This is in addition to your loan. In this circumstance, the debt cancellation addendum is not voluntary, adding extra costs — potentially thousands of dollars — to the amount of your loan. The total is determined by how much you borrow and your driving history, but your loan contract should break down the costs.
You might be able to reduce the cost of Finova’s insurance addendum if you repay the full amount of your loan within 90 days. At this point, your insurance cost is halved. However, because the question of insurance can make your auto equity loan that much more complicated and expensive, if you don’t have the necessary coverage, it may be better to look elsewhere for a loan.
Is it safe to use Finova Financial?
Yes. Finova Financial’s site is protected with SSL encryption. But it reserves the right to distribute the information it collects — including your personal information and general financial situation — to affiliate services for marketing purposes. You can opt out of this by contacting Finova directly.
Finova Financial reviews and complaints
BBB customer reviews
1 out of 5 stars, based on 1 customer reviews
BBB customer complaints
Customer reviews verified as of
16 October 2020
Finova Financial gets mixed reviews. Better Business Bureau (BBB) reviewers are generally unhappy with their experience. But customers on other review sites generally rank Finova positively. Reviews touch on Finova’s helpful customer service and quick response time, usually one to two days, as reasons to go with the service.
Most negative reviews object to the insurance or debt cancellation addendum you’re required to take out on your vehicle before you can take out a loan. Opting in to the addendum can add thousands of dollars to the cost of your loan. But if you have comprehensive and collision insurance on your vehicle, you aren’t required to take out additional insurance through Finova.
Am I eligible?
To apply for Finova Financial’s Consumer Loan on Car (CLOC) program, you must meet basic eligibility requirements:
Own your car outright
Live in an eligible state
Comprehensive and collision coverage
US citizen or permanent resident
How do I apply?
Click the Go to Site button on this page.
Enter your name, phone number, email address and car model. Click How much can I borrow.
Follow the directions to complete the application with information about the year, make, model and mileage of your vehicle. This information determines how much your vehicle is worth and how much Finova can lend you.
Review and submit your application.
After submitting your application, a Finova representative will call you to discuss your application and complete the loan process.
If approved, your funds are disbursed by check or to your MoneyGram account.
After your funds are either transferred to your MoneyGram account or sent to you by check, you can use your money however you’d like. But receipt of your loan means starting the repayment process.
Finova prefers customers repay their loan through MoneyGram, either online through the money service’s mobile app or at one of its 32,000 retail locations. Paying online comes with a fee, however. If you’d rather pay by check or phone, talk to a customer service representative.
Finova offers terms of 12 to 24 months in most states it services, and loans require regular monthly payments over the full life of your loan. Read your contract to make sure you understand your repayment terms.
Finova financial alternatives
Don’t know if this lender is right for you? Look into these alternatives instead:
Auto title loans. This choice might come with higher APRs than Finova Financial — and you have to own your car upfront. But there might be more title loan providers available in your state.
Payday alternative loans (PALs). Just need a few hundred dollars? Some Federal credit unions offer these short-term loan alternatives with APRs capped at 28% and no hidden fees.
Pay advances. Apps like Earnin allow hourly workers to get advances on money they’ve already earned for emergency expenses.
Get a side gig. If your income isn’t enough for you to make it month-to-month, taking on another job (or asking for a raise) is a more sustainable long-term solution.
Finova Financial offers longer terms than the average auto title loan you might elsewhere, and you don’t need a bank account to get one. But fees can make your loans expensive, especially if you opt into Finova’s debt cancellation addendum.
Yes. After your initial application, Finova performs a soft credit pull to determine the rates and terms you qualify for. If you proceed with your loan, Finova requests a full credit report from a consumer reporting agency.
MoneyGram is a money transfer service you can use to send money to friends, family and businesses around the world. It’s typically faster than sending money through a bank, though fees and limits vary by country and method of transfer.
If you use MoneyGram to receive your funds, it can take a few hours to transfer money to your account. If you prefer payment, Finova can overnight the check within one to two days.
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