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How title pawn loans work

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You can get cash in under 30 minutes, but it’ll cost you.

When you need money today and have trouble qualifying for a traditional loan, a title pawn loan could help. It’s open to all credit types, and you might not even need to have a bank account to qualify.

But consider leaving this short-term loan option as a last resort. Triple-digit APRs are the norm and you could lose your car if you default.

Max Cash Title Loans

Our top pick: Max Cash Title Loans

With a quick online application, Max Cash could help connect you with a lender, finding you options in minutes.

  • Max. Loan Amount: $50,000
  • Loan Term: Varies by lender
  • Turnaround Time: As little as 1 business day
  • No bank account requirement.
  • Not available in 10 states: CO, HI, MD, MT, NE, NY, OH, SD, WA or WV.

    How do title pawn loans work?

    Title pawn loans work a lot like title loans. They’re both short-term loans that use your vehicle’s title as collateral. This means that you can continue driving your car while you’re repaying the loan. Lenders that offer both might have fewer eligibility requirements for a title pawn loan, though most treat it the same as a title loan.

    Despite the name, you don’t need to go to a pawn shop to get this type of financing. Instead, you can apply online or in person with a title loan provider and get your funds in as little as 30 minutes. You can typically borrow up to $10,000, though it depends on your state, lender and the value of your car. In some states, you might not be able to borrow more than $2,500.

    Usually, borrowers have 30 days to pay back the loan in one lump sum. Some lenders also offer title pawn installment loans, which spread the repayments out over several months.

    Compare title loans you can apply for today

    Rates last updated December 16th, 2018
    Unfortunately, none of the short term loan providers currently offer loans in your state. Learn more about short term loans in your state to find an alternative.
    Name Product Product Description Max. Loan Amount Turnaround Time Requirements
    Max Cash Title Loans
    With a quick online application, Max Cash could help connect you with a lender, finding you options in minutes.
    $50,000
    As little as 1 business day
    Must be a US citizen or permanent resident, 18 or older with a regular source of income.
    AutoTitleLoans.com Car Title Loans
    Quickly find a lender and potentially borrow up to $10,000 by using this auto title loan connection service.
    $10,000
    Varies by lender
    Have a regular source of income, not be involved in any bankruptcy proceedings, be a US citizen or permanent residence, be at least 18 years old (varies by state).
    LoanMart Car Title Loans
    A LoanMart auto title loan allows you to borrow money against your car, even if you have bad credit.
    $50,000
    1 business day
    Must live in AL, AZ, IL, MO, NM, SC or UT. Must have verifiable income, car value of at least $1,500 and a vehicle that is paid-off or close to being paid-off.
    Finova Financial Auto Equity Loans
    Short-term loans secured by your car title. Repayments accepted through MoneyGram if you don't have a bank account.
    $5,000
    as little as one business day
    Must live in AZ, CA, FL, NM, SC, TN or OR. Must own your car outright, have a valid car insurance policy and be a US citizen or permanent resident.
    TitleMax Auto Title Loans
    Auto title loans on cars and motorcycles to people in 16 states across the US.
    $10,000
    as little as 30 minutes
    Must have a lien-free vehicle title, government-issued ID, and be age of majority in your state.

    Compare up to 4 providers

    Title pawn loans vs. auto pawn loans

    Title pawn loans and auto pawn loans might sound similar, but there is a slight difference between the two. With a title pawn loan, you can keep driving your vehicle while you’re paying it back. With an auto pawn loan, your lender keeps your vehicle while you pay it back.

    Auto pawn loans also tend to have fewer requirements and could be a better option if you’re unemployed or don’t have a bank account. But you might want to avoid it if you don’t have other transportation options.

    How much does a title pawn loan cost?

    Title pawn loans are an expensive type of financing and commonly come with APRs between 100% and 300%. However, it often varies depending on your state — many set limits on how much your lender can charge in interest or fees.

    • For single-payment title pawn loans, it’s more common for the lender to charge a fee, called a finance charge, rather than interest. This can vary depending on your loan amount and state — sometimes it can be as low as $15 per $100 borrowed. These are typically due in full within 30 days.
    • For installment title pawn loans, lenders typically charge both interest and fees, which can add up over a term of three to six months. On top of the financing fee, you might have to cover the cost of filing a lien on your car’s title. This gives your lender the legal right to seize the vehicle if you fail to repay. The filing fee is set by your state and is typically included in the APR.

    Can I roll over a title pawn loan?

    It depends on your state, but usually you can roll over a title pawn loan. Also commonly known as an extension or renewal, rolling over your title loan involves adding more time to your loan term. Typically, you can extend your term by 30 days at a time. Some states might have limits to how often you can roll over your title pawn loan.

    Rolling over your loan should be a last resort. Extending it just once doubles the cost of your loan — at the very least. The same rates and fees from your original loan often apply, and some lenders might charge a rollover fee.

    What happens if I don’t repay my title pawn loan on time?

    You could lose your car if you don’t repay your title pawn loan on time. However, that might not happen right away. Miss a payment by a few days and you might only have to pay a late fee. If you miss your repayment by longer, your lender might offer to extend your term to collect repayment.

    Otherwise, it will take the steps to repossess and sell your car to cover the cost of your loan. Your lender could also take funds to cover the costs associated with repossessing and selling your car. After your lender collects the funds, it’s typically required to give you any remaining profits from the sale.

    What states allow title pawn loans?

    Title loans aren’t legal in every state. And even where they are legal, the state often has regulations on how much you can borrow, interest rates, fees and terms. Many states also have rules that regulate when and how your lender can repossess your vehicle if you fail to pay back your loan.

    Since states typically treat title pawn loans and title loans as the same thing, check out our title loans guide to find out if they’re available where you live.

    Benefits and drawbacks of title pawn loans

    While title pawn loans can be helpful when you need cash fast, they’re not without risk.

    Benefits

    • Open to all credit types. You don’t need excellent credit to get this type of loan.
    • Fast cash. You can sometimes get your money within 30 minutes if you apply in person.
    • No bank account options. Some lenders might not even require you to have a checking or savings account to get a title pawn loan.
    • Keep your car. You can continue to drive your car while you pay off your title pawn loan.

    Drawbacks

    • Expensive repayments. Triple-digit APRs are the norm for title pawn loans.
    • State restrictions. Depending on where you live, you might not even be able to get a title loan.
    • Could lose your car. Your lender is legally allowed to repossess and sell your car if you can’t repay your title pawn loan.
    • Risk falling into cycle of debt. Many lenders allow you to roll over your title pawn loan, which adds to the cost each time and makes it more difficult to pay off.

    How do I apply for a title pawn loan?

    Most title pawn lenders allow you to apply online or in person at a storefront. But even if you get approved online, you’ll likely need to visit a store to have your car inspected and finalize the application.

    While it’s possible to get a title pawn loan entirely online, it’s rare. It’s also not as fast. You might have to submit additional documents, and you’ll often have to wait 24 hours for a wire transfer.

    Eligibility requirements

    Eligibility requirements vary by lender, but typically you must:

    • Have a lien-free car title.
    • Live in a state where tile loans are legal.
    • Have a state-issued driver’s license.
    • Have a regular source of income.
    • Be a US citizen or permanent resident.
    • Be over 18 years old.

    Steps to apply online

    Looking to begin the application process online? Follow these steps:

    1. Visit the lender’s website and complete the online application.
    2. Wait for a response from your lender. If you’re approved, follow the directions to visit the storefront. Typically, you’ll need to bring a copy of your driver’s license, your car title and your car. Some might also require an extra key.
    3. Follow your lender’s instructions for submitting the documents and wait for a representative to inspect your car.
    4. Review your final offer and sign the loan documents.
    5. Collect your cash and drive home in your car.

    Alternatives to title pawn loans

    Concerned about how expensive title pawn loans are? Consider one of these alternatives:

    Bottom line

    Lenders often use the terms title pawn loan and title loan to mean the same thing. Both use your car title as collateral, rather than the vehicle itself, so you can still drive around while paying off your loan.

    It’s one of the quickest types of financing out there, though with such high rates and the risk of losing your car, it’s best left to absolute emergencies.

    To learn more about how short-term loans work, check out our payday loans guide.

    Frequently asked questions

    Picture: Shutterstock

    Anna Serio

    Anna Serio is a staff writer untangling everything you need to know about personal loans, including student, car and business loans. She spent five years living in Beirut, where she was a news editor for The Daily Star and hung out with a lot of cats. She loves to eat, travel and save money.

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