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 from which to borrow.
- Second, an applicant must demonstrate their ability to afford a title loan and repay it.
Given these two qualifications, it is easy to understand what disqualifies a title loan applicant. 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 a loan from it or if they can’t prove they can afford the loan. If an applicant does not have a qualifying vehicle or income, they cannot get the money they need through an online title loan.
But what are some other reasons an applicant might not be approved for a car title loan? Take a closer look!
So what disqualifies a title loan applicant? Before you can understand why an applicant might not be admitted, it’s important to understand how it works. Title loans are short-term installment loans that allow you to use your car as collateral for the 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 serves as security for the loan, the amount of equity is so important. The value of your car will determine your eligibility for the loan and the amount you can borrow. Typically, applicants can get 25% to 50% of the value of their car depending on:
- your country of residence
- And their income/ability to repay the loan
Now that you understand how title loans work, you may be able to understand how a car title loan applicant can be disqualified. Here are some of the main reasons a borrower might be disqualified:
- Your car does not have enough positive equity: Equity is the difference between the current value of the car and what is owed. If you owe more than the car is worth or it is in poor condition, you may have negative equity and not qualify for a car title loan.
- A lien has already been deposited on the car: If an applicant already has a lien on the car from an existing title loan, they may not qualify for a title loan. However, if the applicant has few payments left, they may be able to refinance their current loan if they are not happy with the terms.
- Inability to Repay the Title Loan: A borrower must have sufficient income for a lender to reasonably believe they can afford the loan. If a borrower is on disability benefits or is self-employed, they may still qualify for an auto title loan, but they must have the lender’s confidence that they can afford it.
If you are confident that you can repay a title loan, you may be wondering what it takes to qualify for one. As with any loan, when you apply for a loan you will need to provide some documents that can, among other things, prove your identity. Here’s what you generally need to qualify for a car title loan:
- Proof of income through bank statements, payslips, etc.
- Proof of address through recent, official mail, such as a utility bill
If you’re like most Americans, you enjoy the convenience of online shopping. You can run so many of your errands online! Grocery shopping, clothing shopping, and even car shopping can all be done from your smartphone or computer. So why not apply for a car title loan online?
With some online title rental options, it is possible to initiate your request from your smartphone or computer!
So why wait to see if you qualify for the financial help you need? Today, with loan options like ChoiceCash title loans, serviced by LoanMart, you can access a convenient three-step inquiry process right from your phone. Just visit the website to get started and submit your loan request online! Call 855-914-2945 to learn more about the title borrowing process and qualification requirements.