How Can a Title Loan Company Take My Car?
Title lenders can take your vehicle during your title loan repayment period, but only under specific circumstances. When you sign a loan agreement, you agree to the specific terms set in that agreement. That includes paying your loan on the set due date. As soon as your contract is signed and the loan is funded, a lien will be placed on your car’s title. It will be released when the loan is paid off in full.5
Until your loan is paid off, the title lender or title loan company has the legal right as your lienholder to take your car. Although you might be wondering, “When will the title loan company take my car?”, the answer is only under a few different circumstances that will be discussed below. Keep reading to learn more about title loans, title loan repossession, and how to potentially avoid it!
What Is Vehicle Repossession?
Vehicle repossession is the legal process through which a financial institution or lender takes back possession of a vehicle from a borrower who has failed to make their loan payments. This can occur when a borrower defaults on their auto loan. It is most commonly due to financial hardships or nonpayment of the loan. Once initiated, the repossession process can take anywhere from a few days to a month. But it depends on the individual’s current state of residence because vehicle repossession laws vary from state to state.
Not only does repossession leave you without a primary method of transportation, but according to Experian, it also stays on your credit report for up to 7 years!
When Can a Title Loan Company Take My Car?
If you took out a title loan, you may be thinking, “When can a title loan company take my car?” Before you can understand when repossession happens, it’s important to know that each state has specific procedures that lenders must legally follow during the repossession process.
However, regardless of your state of residence, repossession occurs when an individual defaults on an auto loan or an auto title loan. This is due to the fact that both of those loan options are collateral-based loans. This means that the loan is secured by an asset.
If you are borrowing against the value of your vehicle through a vehicle title loan, you are required to pay it back. Additionally, you must pay the loan back as agreed upon in your loan agreement.
Otherwise, the lender can choose to seize your vehicle and sell it to cover your outstanding loan balance.
How Can I Avoid a Title Loan Company Taking My Car?
It’s important to mention that most title lenders will typically prefer to avoid repossession. However, here are some tips to avoid having your car seized by a title loan company:
- Pay your loan on time: Timely payments are crucial to avoid repossession. If you are forgetful, skip the manual payments and instead opt for automatic payments from your bank account! That way, you don’t need to remember due dates.
- Talk to your lender: Don’t wait until you’ve missed several payments. If you anticipate that you are going to struggle with your title loan payment, make sure to talk to your lender or loan servicer prior to defaulting on your loan. They may be willing to help you find alternative solutions. That could potentially include changing your payment date to one that matches your current pay schedule!
- Refinancing: If your title loan payments have become unmanageable, you should try to consider refinancing your loan with a new lender or your existing lender. Max Cash Title Loans can help you find a suitable lender if you want to try to refinance your existing loan!5 Click here to learn more about title loan refinancing.
Remember that communication with the lender throughout this process is crucial. The lender you choose to work with can work with you to come up with a resolution. Being transparent about what is happening with your current financial situation is important if you want to find a solution! Are you unhappy with your current loan terms? Give Max Cash Title Loans a call today to discuss your potential options!5
What Can I Do if My Car is Repossessed?
If your vehicle was repossessed, and you would like to recover your vehicle, you will need to come up with a plan to pay off your outstanding balance. Most title lenders will give you the chance to pay off your balance. Then, you can get your vehicle back if it has been repossessed. Either borrow from friends or family or get a second job to make some extra cash!
How Can I Refinance My Current Title Loan?
To borrow something means to use it and then give it back- that’s just how borrowing money works! If you need to borrow money immediately, the most popular options are personal loans or cash advances. Additionally, there are online payday loans, pawn shop loans, and traditional bank options. Just because they are popular, it does not mean that they are right for you. You can try to refinance your loan that is not a title loan with a title loan!1 2 5
Loan representatives can access your situation as soon as you can. They have a network of top-notch lenders and are ready to help you find your options.5 At Max Cash Title Loans, you can expect a hassle-free way to try and refinance your current loan that is in good standing.5
Call Max Cash Title Loans today at 855-562-5626 or click here if you want to learn more about how title loan refinancing works!5