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Published Date: February 21, 2018
Firstly, how does a vehicle title loans work? It’s simple; the lender uses your car as collateral. Your car is valued and you are loaned accordingly. In California, the minimum amount set by state law is $2,500. This is duly supervised by the DBO.
If that sounds like you, then YES, you can still get a title loan with a terrible credit history that is a thousand miles away from being impressive.
You most likely like many others out there have made poor financial decisions that have dented your credit score but it is 100% possible to still get a title loan
Your car is automatically the collateral for your auto title loan. Your car makes it easy to obtain the car title loan as the lenders have something to fall back on if you default on your loan repayment. Though bad credit may impede getting loans in some areas, this is entirely different for car title loans as your vehicle’s worth and ability to repay the loan is mainly the basis of receiving a loan not your credit score. This in no way implies that the lender does check your credit history, they will certainly need to know if you’re heavily defaulting on major payments alongside being unemployed.
But keep in mind that past bankruptcies hardly get in the way of getting a car title loan.
That said, your credit rating/score only represents your past.
The approval is not influenced in any major way by a bad credit rating. Car title loans are almost effortlessly secured because lenders are assured by the important asset in question which is your car and its value if unfortunately, you fall outline. This means, aside from your pledge to repay the loan the lender has something valuable to hold on to. In essence, auto title loans are somewhat a blessing for people with bad credit record and are finding it hard to get a loan elsewhere.
Also, your job will be your credit. So as long as you can show your proof of income, you will be able to get a pink slip loan.
Giving auto title loans to persons with bad credit history isn’t much of a big deal for lenders as bad credit will not stop you from getting a car title loan. The value of your vehicle and your ability to repay are the most important things. You can get from 60-80% of the car’s resale value. Other factors that could influence getting a title loan despite a bad credit score include:
The quick fact here: a vehicle with more than 200,000 miles in it will not qualify for a title loan in California, except it is a diesel truck.
Conclusively, your bad credit should not deter you from applying for a car title loan as it plays very little influencing most lenders decision to give you a loan.