Leased cars cannot be used as collateral for title loan loans. A title loan cannot be obtained on a leased vehicle unless the title loan lender purchases the lease and becomes both your vehicle loan and title loan lender.

When you purchase the lease, you free up the title, which eliminates the problem of getting a title loan on your car that you just purchased.

Montana Capital Car Title Loans may help you with this process even though it is complex. Find out if you are eligible for a title loan on your leased car by applying online.

Your Leased Vehicle Is Ineligible for a Title Loan 

Having a leased car means you don’t own it, since you must still pay for it. The controlling interest belongs to your lender. Due to this, you cannot use the vehicle as collateral for a title loan since you do not own it.

Get Rid of the Lease

Are you looking to cash in on your leased car?
You can’t get a title loan on a leased car unless you get rid of the lease contract.

It is difficult to get a title loan on a leased car, but with Montana Capital it is not impossible.

What Are My Options With a Leased Car?

Want to learn more about using your leased vehicle as collateral for a title loan? Two options are available when you lease a car:

A. Buy the Lease to Free up the Title

B. Find a Quality Title Loan for a Lease Buyout

A. Buy the Lease to Free up the Title

Leased cars can typically be purchased throughout the lease period. In doing so, you are purchasing a car you are familiar with and trust.

The lease buyout price must be paid with a check or financed. Included in that price are:

Residual value of the car

Payments remaining

Contractual fees

Sales taxes that apply

Things to Remember When Weighing an Auto Lease Buyout:

It makes sense to buy out your car if you like it and can afford to do so.

Before you decide to buy out your lease, research your car’s market value.

Even though a car’s residual value will probably not change, you can negotiate reduced fees.

Leases can be bought out before or after their expiration dates.

How to Estimate Your Car’s Buyout Price:

Look up the “residual value” of your car in your lease contract. After your lease ends, which could be a few months or years away, this is what your car will be worth.

You can estimate the car’s buyout price by adding its residual value to any remaining payments. For example, if your car’s residual value is $15,000, and you owe six more payments of $500. Your buyout price would be about $18,000.

In some cases, however, you may still have to pay a lot if your residual value is low and your payments are high. Depending on your situation, you may need to access your savings or explore other alternatives.

B. Find a Quality Title Loan for a Lease Buyout

Title loan lenders who finance lease buyouts and take on poor credit customers can be difficult to find. Some lenders are willing to provide this service even though they don’t advertise it up front.

Even if your vehicle is still financed and not yet paid off or you have a lease, Montana Capital may still be able to offer you a title loan.

Montana Capital Car Title Loans Buyout Process


Based on the VIN, year, make, and model of your vehicle, we determine its value and make you an offer based on your ability to repay and the credit criteria.

Provide an Offer.

We provide you with the loan offer we can finance if you are pre-approved.

Coordinate Your Lease.

When determining our offer to you, we take into account any outstanding balance with the lease company.

Pay Off Your Lease.

The remaining balance owed to the lease company will be paid off by Montana Loans. We may be able to give you more money based on our credit criteria, and you get to keep driving your car while you pay back the loan.

Key Takeaways of Understanding Auto Equity Loans:

Auto equity loans allow you to use your car’s equity while keeping possession of the car. Of course, your car is the collateral, and you could lose it if you don’t make your payments. But it can be an easier way to quickly get the money you need, unlike traditional loans that have stricter credit criteria and a longer loan process.

What Can Be Used as Collateral for a Personal Loan?

If a title loan isn’t the secured loan for you, a personal loan might be a better option.

Lenders accept different types of collateral for personal loans. It usually depends on how much you borrow and your qualifying factors. Typically, the collateral should be fairly liquid or turned into cash fast.

Some examples include:

Calculating the Terms of Your Online Title Loan

When you’re looking for a loan, the important factors that affect how much you’ll pay are the loan amount and the interest rate charged. The interest rate can vary, but the rate is affected by:

  1. The state where you live.
  2. Length of your loan term.
  3. Current value of your vehicle.
  4. Credit reports are sometimes required.

Keep in mind that other factors can also go into the costs of the final loan contract. You can review all the costs and charges before you sign. There are no hidden fees and nothing will be added.

The Benefits of Using a Car as Collateral

  • Easier to qualify for a loan
  • Access to fast cash
  • You can keep and use your car

The Drawbacks of Using a Car as Collateral

  • You put your car at risk of repossession
  • High interest rates
  • You could get upside down on your loan (owe more than its value)

Title Loan on Leased Car FAQs

Yes, you can use a finance car as collateral for a loan as long as your title loan lender is willing to pay off your financed car. The requirements depend on your creditor and financier’s estimation of your ability to repay the loan. Montana Capital Car Title Loans does not necessarily require your car to be paid off before using it as collateral for a title loan.

Every lender differs, but on average, you can borrow up to 70% of the car’s value with an auto title loan as long as you own the car without any financing and are able to repay the auto title loan. The minimum loan amount varies from state to state. Montana Capital’s minimum loan amount is $2,600, compared to $1,000 in some states.

Always read the fine print before signing a loan or lease agreement. Know the costs, including interest, and any prepayment penalties or other requirements that would stop you from buying out a lease or paying an auto loan off early. You shouldn’t find any hidden fees or prepayment penalties with Montana Capital.

Every lender has different requirements, but getting a leased car with bad credit is much harder than buying a car. If you get approved to buy a car, you’ll likely pay higher interest rates or more fees to compensate for the risk, but your chances of being approved are typically higher.

No, to get a title loan with your car as collateral, you must get rid of your lease contract.

The Bottom Line

The answer to the question, ‘can a leased car be used as collateral?’ is no.

Ultimately, your leased vehicle is the dealer’s asset because you are merely renting the vehicle. The same holds true if you were to try and use your rental home as collateral. You can’t because it isn’t your property. The car dealer providing the lease is like a landlord – the owner of the property.

Using a car as collateral for a loan is a common way to get cash fast, but if you have a lease, you’ll have to take a few steps first. At Montana Capital Car Title Loans, we may help you determine how much equity is in your car and explore your options to buy out the lease so you can tap into your car’s equity and get the funds you need. Call us now or apply online and find how much cash you can get!

Written by

Samantha Hawrylack

Samantha Hawrylack is a writer for Montana Capital Car Title Loans and a personal finance expert. Sam received her Bachelors of Science in Finance and her Masters in Business Administration from West Chester University of Pennsylvania. She began her career in the financial services industry and shifted to an entrepreneurial role where she could directly impact clients. Sam has an impressive background in personal finance and business management.