We receive a lot of questions from interested applicants who visit our site. Some of them revolve around what fees to expect with a car title loan and how long it’s going to take to pay off the full amount. By far the most common question we receive is if they’ll need to hand over their vehicle during the life of the loan. Keep in mind, we’re not talking about the vehicle pink slip, we’re talking about the car you drive. Most people know they need to transfer and hand over the vehicle pink slip or car title before they get the loan. But some are still confused about whether they can keep driving the car. We’re here to tell you that you should have no problem keeping the vehicle during the complete loan term. Of course there are times when you may not even have access to the pink slip to hand over to your lender. You may have lost the actual paperwork or the car may not yet be paid off. Do what you can to get the pink slip to your lender. Some states offer fast services to replace a lost or missing vehicle title, and you should definitely take advantage of them.
If you apply with a company that wants to hold your vehicle as collateral you should call them out and ask why. If they say it’s normal protocol then you should take action. We can tell you that most lenders in the US will be fine with only the vehicle pink slip. We know of some services who may have specific situations where they would want to keep your vehicle. These may include some pawn shops that treat your car much as an item you pawned in their store. Others will claim to need to hold the car if it’s an expensive or high dollar loan, but these situations are unique. In any situation you need to check the different options if you apply for an online car title loan. Be especially cautious if the company says they need to hold your vehicle as collateral. Spend a few minutes online and apply with a lender that offers same day car title Loans. It’s likely you will come across a more reputable company that has no problem giving you a loan in exchange for the car’s title.
We can think of many reasons why it’s not a good idea for a title loan company to hold your car as collateral. The biggest reason is that you have no way to get to work or handle your errands. Who wants to offer cash to someone who needs their car to get back and forth to work. It’s likely that a person would go on to lose their job if they take out an online loan but have to give up the daily use of the car. Another risk you run if you hand over the car is what happens if the company goes bankrupt or the vehicle disappears? This wouldn’t happen if you’re dealing with a large nationwide car title loan service. But none of those larger companies would ask for the car as collateral in the first place. Save yourself the headache of worrying about the status of your car. Don’t stress out if a lender asks you to hand over the vehicle. Simply thank them for giving you a quote and contact one of the other many car title loan companies. You’re bound to find a lender that will be happy with your pink slip as collateral!
Janet Patterson is VP of Marketing Communications for Highway Title Loans and the feature editor of its Lending Blog. Janet has worked in the financial service industry for over a decade, with 7 years of experience in the car title loan industry. She previously managed a customer service team that helped and advised consumers on all their lending related questions and concerns.