Bad credit or bad credit history can follow a person throughout their life. When looking for a traditional loan, bad credit may affect eligibility. However, title loans may be a good option for those with bad credit who are looking for funding. Title loans are loans where the borrower’s vehicle is put down as collateral. When looking at car title loans, bad credit may not be a huge factor in determining if a person can get a title loan. Lenders for title loans look at a few other things when determining whether not someone is eligible for a car title loan.
What Do Title Loan Lenders Look At?
Before thinking about a title loan it may be helpful to know and understand credit and credit scores. When it comes to title loans, credit does not matter as much as it does with traditional loans. This is because car title loan lenders look at other factors. These major factors are:
- Income
- The Value of The Vehicle
How Your Income Works in Title Loans?
Income is a critical factor in car title loan eligibility. Interest rates on car title loans can be higher and that is why title loan lenders look at income. By looking at income lenders determine whether a borrower can realistically pay back their loan, along with the interest it acquires. Keep in mind that most title loan payments occur monthly and so most places will ask for monthly income.
How Do I Prove Income? What Counts as Income?
There are several ways that one can show proof of income:
- Paystubs
- Bank Statements
- Invoices
- Letter of Employment
- Tax Information
In addition, income doesn’t have to come from traditional employment. Here a couple forms of income that may qualify for a title loan:
- Self-Employment
- Annuity
- Inheritances
- Prizes/Settlements/Rewards
- Severance Pay
Generally for most lenders, unemployment is not seen as income. Lenders may vary in how they handle income so it can be a good idea to look around. At Max Cash Title Loans, we can do that work for people. We have several lenders that may be able to work with whatever kind, or whatever amount of income a person has5.
How Your Vehicle’s Value Work in Title Loans?
Another important factor for eligibility and the amount a title loan may be worth, is the value of the vehicle being offered. Like income, this factor will vary from one lender to the other. Most lenders ask for a few things to get to a value for a vehicle.
- Make
- Model
- Year
- Mileage
- Make sure the title is lien-free
- Condition (they might ask for several pictures of the vehicle)
After they look at all of this most lenders will come up with a value for the car title loan. Some lenders use places like Kelley Blue Book or Black Book. Once they come with a value for the loan, they will work to come up with a personalized repayment plan. As a borrower, knowing the best ways to pay back a title loan may be useful.
What If I Have More Than One Vehicle?
If a person has more than one vehicle and their titles are lien-free, it might be a good idea to let the lender know about the others. For car title loans, only one loan can be taken out at a time, and the value of the vehicles owned cannot be combined. Only the lender knows exactly how much they may give out for each vehicle. By giving the lender more options, one may increase the amount of their loan5. Whichever vehicle a person decided to take the title loan out for, a good thing to know is that the vehicle can still be kept at home and driven as the borrower makes their monthly payments.
Why Go to Max Cash Title Loans If I Have Bad Credit?
At Max Cash Title Loans, we are not a title loan lender, instead we are a free service that matches you with title loan lenders all across the country5. When it comes to finding a title loan, variety may be the best way to go about it. We know and trust our lenders, and we have hundreds of them. Even if a person has bad credit, we may be able to find a lender that may want to work with them5. We can also save people tons of time by doing the searching for them. We would be happy to talk to you about title loans, despite any bad credit history: send us a text or give us a call at 1-855-561-5626 or visit us in person.