You may have seen advertisements or been approached about guaranteed approval online title loans and thought you could get money whenever needed.
Unfortunately, those advertisements are typically a scam, as no lender can guarantee title loan approval until they’ve reviewed your application and qualifying factors. While it’s true that car title loan requirements are much more lenient than personal loans or other bank loans, there are still requirements you must meet, including proof of ownership of a lien-free vehicle and adequate income to repay the loan.
So, while guaranteed title loan approval isn’t legit, there are legit title loan lenders, like Swift Title Loans, that offer loans to help in emergencies, even if you have bad credit.
Why Title Loans are Considered Guaranteed Approval
Many consider title loans guaranteed approval because they don’t rely on credit history or scores. In other words, you don’t need a minimum credit score or even a job to qualify. Instead, car title loan lenders rely on a car’s value and your ability to repay with a steady income source.
While people with a bad credit history may have a higher chance of approval than they would with traditional loans, there’s never a guarantee of approval until you go through the application process and get approved.
What’s Required for Online Title Loan Approval?
Auto title loans have minimal requirements to qualify for the secured loan, which is why many people assume they offer guaranteed approval, including the following:
Proof of Consistent Income
You don’t need to prove you have a job but must have a consistent income. The income could come from any reputable source, including:
- The government, such as Social Security or disability income
- Your retirement plan, whether a 401K or IRA
- Your pension balance
- Workmen’s comp if you were hurt on the job
- A part-time job or a side hustle
The key is to have valid proof of income from the original source. This may include bank statements, paystubs, or an award letter that states the amount of the funds and the frequency with which you receive them.
Ownership of a Lien-Free Vehicle
Aside from proving you can repay the loan, you must prove you own a lien-free vehicle. This means your car has no outstanding loans, and you own the car without anyone else. If another person’s name is on the title and there is an “and” between the names, you’ll need approval from both owners to get the title loan, not just one.
Proof of Residency and Insurance
Some lenders require that you prove you live in the state you applied for the title loan in because not all states allow them. They may also require proof of adequate auto insurance to prove the vehicle has proper protection since it is the loan’s collateral.
Do Title Loan Lenders Check Your Credit?
The best part about title loans is you can have bad credit and still get approved. While lenders look at your credit history, it’s not a preliminary factor in determining eligibility. So, unlike traditional loans, you don’t have to worry about bad credit interfering with your ability to secure funding.
The Application Process for Car Title Loans
While every car title loan lender has a different process, here’s a general rundown of what lenders require so you can tell if an online title loan is legit:
1. Complete an Online Application
The application process for title loans is typically online. You submit information about yourself, your car, and your income. The application takes only a few minutes, and you get answers instantly.
2. Evaluate Your Options and Select an Offer (If Approved)
If approved, you may receive a couple of options for a title loan. Before choosing the right loan, consider the interest rates, loan amount, and monthly payments required.
3. Provide the Necessary Documentation
After selecting an offer, you must provide the necessary documentation to prove you qualify for the loan, including:
- Paystubs or other proof of income
- Proof of residency
- Government-issued ID
- Proof of insurance (if required)
- A copy of the title in your name
4. Send Pictures of Your Vehicle
Title loan lenders also require pictures of your vehicle. This can replace an in-person inspection as long as you provide clear pictures of the interior and exterior of the vehicle, along with the odometer reading.
5. Receive Your Funds
Usually, you receive your title loan funds within one business day of approval and begin repaying the loan as the loan agreement states.
FAQ
What Are the Benefits of Guarantee Approval Online Title Loans?
Guaranteed approval online title loans can be good in a true emergency because they provide fast cash even if you have bad credit. However, because they have such high interest rates and fees, it’s important to only use these loans when you’ve exhausted all other loan options.
What is the Maximum Loan Amount on a Title Loan?
Every title loan lender allows a different loan amount, but most will lend between $500 and $50,000, depending on your vehicle’s value and your ability to repay.
Does a Title Loan Repo Affect Your Credit?
Like any repossession, a title loan repo will show up on your credit report and likely damage your score. How much it changes your score depends on your current score and the amount of money still owed on the title loan at the time of repossession.
Final Thoughts
While guaranteed approval online title loans aren’t a thing, there are legitimate title loans that offer fast cash and more time to repay them than payday loans. Like any loan, always ensure the lender’s legitimacy, and shop around to ensure you get the most competitive interest rates for the type of loan you need. Bad credit loans are legit in many cases, such as with Swift Title Loans, but be sure you know what you’re getting into before applying.
