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Friday, September 22, 2023

How Online Title Loans Work

Getting an online title loan can be a fast and convenient process. You don’t have to leave home to get one and you’ll have the money within 24 hours or less — with direct deposit. 

In exchange for the money, you’ll agree to surrender the title to your vehicle should you become unable to repay the loan as agreed. For this reason, and because an online title loan is so easy to get, you must be certain you’ll be able to meet the terms of the loan agreement. 

Here’s how online title loans work. 

Provide The Proper Documentation

After running an Internet search for online title loan lenders, carefully researching the ones that look good and deciding upon the one with which you’ll go, you’ll need to be prepared to provide the following documentation.


1. Proof of your identity in the form of a government-issued ID. This can be a driver’s license, a state ID card, passport, or military ID (in states in which car title lenders are permitted to loan to service members).

2. Proof of residence, such as a utility bill, insurance statement, lease agreement, rental agreement, or mortgage coupon.

3. Proof of income, which can include bank statements, paycheck stubs, tax returns and the like.

4. Title certificate for the vehicle in question — in your name. If the title is shared with another person, they will also have to complete an application and share the relevant documentation listed above. 


5. Photos of the vehicle shot from each of the four primary angles, interior pictures and a close-up photo of the odometer reading. You’ll also need to provide a photo of the vehicle identification number (VIN) matching the one on the title certificate.

Application Submission

With the above documentation at the ready, you can proceed to fill out the online title loan questionnaire. In addition to basic information about yourself, be prepared to provide the vehicle’s make, model, year of manufacture and mileage (which must match the photo of the odometer reading you submit). 

Generally, you won’t have to be concerned about a credit check. Many online lenders don’t feel a need to conduct these because they know they can recover their investment by selling the car if things go sideways. 

That can be good news for borrowers experiencing credit problems. However, it also means that paying on time won’t do anything to improve your credit score, as your payments on the title loan won’t be reported to credit bureaus. 


Vehicle Evaluation

The photos mentioned above will be used to help the lender determine the condition of the vehicle. It is important to make sure those pictures are as clear as possible. You’ll also want to make sure your car is as clean as possible, because the value assigned to the vehicle depends largely on how well it shows. This, in turn, will factor into how much you can borrow.

In instances in which there may be cosmetic damage such as dents and or scratches, you may still be able to get a loan, but the amount will be lower than if the car were in pristine condition. Remember, the lender is trying to get an idea of how much cash they’d be able to get for the car at auction, should the need to sell it arise. 

It’s to your advantage to show it at its best.

Approval and Funding

Assuming all goes well, the funds can be deposited directly into any bank account you designate. You’ll need to provide the account number into which you’d like the funds deposited and the routing number of the bank at which the account is held. 


Funds can also be sent in the form of a check. Many lenders will provide overnight service. Electronic transfers are offered to any money transfer location you specify as well.

In Summary

These tips will make getting an online title loan easier and much faster. Just be certain you can pay the loan off in the amount of time you agree upon with the lender. If you meet the terms of your loan agreement to the letter, everything will work out just fine.  

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