How Can A Car Be Used As Collateral?
July 13, 2021 | June Mckaig
If you need a quick loan on short notice, applying for a title loan could be the most suitable option for you. Car title loans are a type of secured loan, and this security makes it more accessible and easier to apply for than most other loans. So, let’s break down how a car can be used as collateral in more detail below.
Using A Car As Collateral For Title Loans
How Can A Car Be Used As Collateral?
Title loans are a type of secured loans. Secured loans require a prospective borrower to provide a guarantor or collateral that will protect the lender’s assets.
With title loans, your car title acts as that collateral. While the car value will determine the maximum loan amount you qualify for.
Can A Car Be Used As Collateral While Staying In My Possession?
Yes, if you get a title loan with New Mexico Title Loans, Inc. the car will stay with you for the duration of the loan payment period.
This is because while your car’s value is what determines the terms of your loan, technically it’s not the car itself, but the car title that acts as collateral.
While the car stays with you, the title stays with New Mexico Title Loans, Inc. and remains with us until the loan is paid off in full, ensuring our assets are protected.
What Else Do I Need To Qualify For A Title Loan?
Now that you know how can a car be used as collateral, let’s discuss what else you need to get approved for a title loan.
Title loans being accessible and easy to acquire sometimes tends to be mistaken as them being unregulated, with anyone being able to simply walk into the store and walk out with one, not having to go through any procedures.
That’s not so. New Mexico Title Loans, Inc. may not have many qualifying requirements – especially compared to more traditional financial institutions – but it does have the following requirements:
- You need to be over 18 and provide a valid state-issued ID or driver’s license to prove it.
- You need to own a car and provide it for a short inspection that’ll determine its value.
- You need to have the car’s lien-free title in your name to prove car ownership.
Can A Car Be Used As Collateral For A Loan By An Unemployed Person?
Yes, it can. You don’t need to be employed to apply for title loans New Mexico offers.
This is because using your car as collateral ensures that the lender’s assets are protected, even without you having a stable income. Since the lender is protected, they aren’t likely to ask for any other proof of your ability to repay the loan.
Any means you have for income can be used to repay the loan. It’s completely up to your discretion.
Can A Car Be Used As Collateral For A Loan By A Person With Bad Credit?
Yes! At New Mexico Title Loans, Inc. you can use your car to get a title loan regardless of what your credit looks like!
While the loan representative you’ll be working with may have to perform a quick credit check, you aren’t likely to get rejected just because your credit turns out to be bad, since other factors play a bigger role in your qualification.
In fact, as long as the required items you provide satisfy the lender’s demands and your car is deemed suitable to act as collateral, you have a chance to get approved even if your credit is outright nonexistent.
How To Get A Title Loan
You can get started by either calling your chosen New Mexico Title Loans, Inc. store or submitting a filled-out online form on New Mexico Title Loans, Inc.’s website. You then just need to wait for a loan representative to get in touch with you.
In either case, the loan representative will confirm your information during a call, as well as provide further information about the process.
They’ll also schedule an appointment with an associate to review your required items. Drive your car to the appointment, and make sure to have your ID (or driver’s license) and the car’s title with you.
The associate will perform a short inspection to assess your application and determine if you qualify for the loan, how much the maximum loan amount you qualify for is, and what your payoff schedule should look like.
If they decide you qualify, they’ll help you with final procedures, and you’ll get your loan the same day!
That’s how can a car be used as collateral for a loan. The process is simple and could get you up to $10,000 in less than a day.
Start Your Title Loan Process Today
You can get a title loan right now for up to $10,000 in less than a day! Submit your online form today to get the process started.