Introduction To Car Title

If you need some money quickly but have bad credit that makes it difficult to qualify for most loans, one option for getting that fast infusion of cash may be a Texas car title loan.  If you tend to live from one paycheck to the next, it can be difficult to find cash to pay for unexpected expenses.  Or if you happen to have poor credit history or don’t have a regular job.

Whatever the reason might be, if you are unable to borrow money from a traditional lender, like a credit union or bank, a car title loan is potentially an easy and fast solution when you suddenly need some cash.

Introduction To Car Title Loans

A car title loan company will loan you money based on your promise to repay and your signature.  The title of your car is used as collateral for the loan.  It is a type of secured loan, since there is an asset backing up your promise to repay the loan.  If you fail to pay back the loan according to the agreement terms, then the lender can take your car.

Who Qualifies For A Car Title Loan?

Almost anyone who owns a vehicle that is worth more than what is currently owed on it (the equity) can qualify for a car title loan.  A car title loan company lends part of this equity in your car and provides you with cash.  Normally, the only other qualification is that you must prove that you have valid auto insurance. After the loan is made to you by a lender, your car basically belongs to the lender until you have paid the balance on your car title loan in full.  You still are able to drive the car as long as you have it properly insured.


The main benefit of a car title loan is the ability of getting instant cash.  It doesn’t matter what your credit history is.  Your credit report isn’t even checked by the lender.  It is a fast and easy to get money quickly.


The main drawback is the possibility that you may lose your car if you can’t pay back your loan.  Car title loans are usually short-term loans of 30 or 60 days.  A majority of lenders will extend these terms, but the interest rate is often tied to how long the term of the loan is.

The second major drawback is that car title loans tend to have quite high interest rates since they are considered to be high risk loans.

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