Car Title Loans in Davie, Florida: A Complete Guide
Looking for a solution to the seemingly never-ending fees and costs that are constantly piling up?
Or perhaps you require quick cash for unexpected expenses that popped out of nowhere?
Well then, look no further as car title loans offer a fast, convenient, and adaptable answer to whatever finances you need to sort out!
In this guide, we’ll tell you all you need to know (and more) about car title loans here in Davie, Florida, so read on to learn if the loan process might be applicable to you!
Car Title Loans: What Are They?
Before diving into the discussion of car title loans, it would be best to first define what exactly we’re talking about.
A car title loan is an example of short-term financing and falls under the category of short-term loans since it provides you with cash and has a brief loan term for paying it back.
The best part? Your credit history isn’t one of the main deciding factors for whether you pre-qualify or even qualify for a loan!
That’s right — you don’t need a shiny credit record for this title loan!
Just like with other loan types, the borrower can receive a certain sum of money in exchange for collateral (which acts as security for lenders).
Collateral & Ownership
In a car title loan, the collateral in question is the TITLE of one’s car, NOT the actual vehicle.
Still a little bit confused? Simply put, the title lender just gives the rights or the title of the car, but not the actual car itself.
So if you opt for such a title loan, you’ll still be able to use your beloved vehicle during the loan period, even while you make your monthly payments.
However, the ownership and title of your vehicle are placed in the hands of your loan lender until you fulfill your end of the loan process.
If all of this sounds familiar, then perhaps you’ve already come across car title loans through its other names, like “auto title loans,” “pink slip loans,” or “vehicle title loans.”
How Do Car Title Loans Work?
Similar to title pawns, car title loans work by surrendering a car’s title for a certain loan amount.
This is necessary so that the lender — who is giving out the money for the loan — can have some assurance that the borrower pays the loan proceeds back.
It’s too risky to simply loan money without any security (in case the borrower never returns the cash), so the car’s title is temporarily given up until the agreed payment terms are complete.
This means two things:
- First, everything should be fine, given that you are on track with making payments (since your title will eventually be returned)
- Second, there is a risk of repossession for your vehicle (if you fail to repay the loan).
As with all good things, there is indeed a great risk when it comes to something as quick and convenient as an auto title loan.
The Requirements to Apply for a Car Title Loan
Now that you know the basics, how can you be sure that you qualify or have the required documents to avail of a car title loan?
Well, for most title loans here in Davie, Florida, these are the things to keep on hand:
1. Car Title
One of the most important documents to present when submitting a car title loan application is a car title since this serves as the loan’s collateral.
The title should specify the vehicle that’s up for possible repossession, as well as the details indicating that you are the rightful owner of said car.
Think of the car title as the car registration, where all of the pertinent information on the vehicle can be found.
Though you should still be able to use your vehicle throughout the loan, some lenders may require a physical inspection of the vehicle for you to be pre-approved for the loan.
Sometimes, images of the vehicle would suffice.
It is also worth noting that the vehicle’s state could also affect the loan amount or how much money you receive.
3. Government-Issued ID
Rest assured that with trusted loan lenders, your private information is kept confidential and is only used to confirm that you are indeed the owner of the car title.
Examples of government-issued IDs are your driver’s license and passport.
TAKE NOTE: If you submit a driver’s license, it should be a valid driver’s license and not an old and expired one you have lying around!
Using these IDs (e.g., your driver’s license), the loan lender can verify the details on the car title and finalize the loan.
4. Bank Account/Checking Account
This is included in the basic information required by some lenders in Florida since they need to know where to deposit the money (if ever your agreement is not centered on cold hard cash).
5. Proof of Income
For most lenders, proof of income is of top priority to ensure that you are indeed capable of making your repayments.
6. Proof of Residency
Given that we’re talking about a Davie title loan in Florida, some lenders may ask for proof of residency to confirm your address and verify that you reside in the state.
This could be used to get in touch with you later on regarding your loan.
How to Apply for Car Title Loans in Davie, Florida
Now that you know everything about title loans and how they work, let’s go through how to apply for them in 4 simple steps:
Step 1: Compare Different Creditors and Loan Lenders
Before pulling the trigger on title loans, it would be best to first assess what lenders are available in your area and what loan terms they may offer.
Not all loan agreements are made equal, and you could save big bucks just by reading the fine print.
It is also worth noting that though credit records are generally not considered for car title loan approval, some lenders may still opt to perform a credit check on applicants.
This is very important to remember!
Step 2: Fill Up Application Details
Prepare the necessary loan documents and other requirements to have your loan approved as soon as possible.
To save even more time, try to go for a lender where you can apply online from the comfort of your home!
Afterward, carefully fill up the loan application and make sure all the information is accurate with regards to your identity and the collateral.
We also recommend going through the loan’s details one more time before submitting it.
PRO TIP: Take a good look at the involved interest rates and what these rates pertain to. Are these referring to monthly or yearly rates? Do they increase over time, or does it stay constant?
Step 3: Have Your Vehicle Assessed and Verified
Though the loan may primarily involve your car’s title, the vehicle itself plays a big role in determining how much money you ultimately receive from the title loan.
The amount could be affected by your vehicle’s year, make, model, and overall state, which is why your lender may ask to physically see your vehicle.
An important concept to know for this step is the idea of your car’s equity. Basically, this is the difference between your vehicle’s value and the amount owed on the loan.
To illustrate this in an example, let’s say that your car is worth 2,000 dollars while you owe 500 dollars from your loan amount, then you essentially have 1,500 dollars in equity.
Step 4: Monitor the Inflow and Outflow of Cash
Now that you’re done with the application period, observe whether the cash that entered your bank account aligns with the agreed amount you settled with your lender.
Keep track of where you spend the loaned cash, and always remember to make your payments!
Whether it be for entertainment, business, or household purposes, do remember to keep track of your finances and to make wise credit decisions.
Last but not least, ensure that you constantly stay on top of your loan so that you never get blindsided and lose your collateral
PRO TIP: Try to automatically allocate a fraction of your income for repayment!
Auto Title Loans: The Good & the Bad
Applications for car title loans are notoriously fast, quick, and speedy (you could even be done in 30 minutes or less!).
For this very reason, title loans are preferable when bills and payments are fast approaching since you can receive your money almost right away.
#2 You Can Use the Money From Davie Title Loans for Anything
Unlike other loan types with specific uses (for example, loans only for education or tuition fees), the cash received from a car title loan can be spent anywhere (within legal bounds of course).
This makes it applicable for whatever costs or expenses pop up in your daily life, whether medical fees, utility bills or whatnot.
Having a short loan term might seem stressful to some, but for us, this just means that you won’t have to worry about your loan for long!
Wouldn’t you agree that a loan term lasting 30 days would be much easier to monitor compared to something that spans for several years?
#1 Relatively High Interest Rates
Given that car title loans are short term loans, lenders tend to make up for this by utilizing high rates for interest.
Although we would love to give you a definite number to prepare you in advance, the interest rate ultimately depends on the lender.
But generally, they are on the HIGHER side, so do read the terms and conditions carefully!
#2 Many Risks Involved
As previously mentioned, everything should be fine as long as you make your payments on time to get your car title back ASAP.
However, one cannot ignore the possibility of vehicle repossession in the event that you fail to pay back the amount borrowed.
To tie it back to the relatively high interest rates mentioned above, there is also a risk of getting trapped in debt.
FAQs & Other Things You Should Know
Are Auto Title Loans Legal?
Though there is nothing inherently criminal or bad about car title loans, it is worth noting that some states deem it illegal.
To some, title loans may be seen as risky or something used to target vulnerable borrowers in need of financial assistance, especially when compared against more “secure” institutions one could turn to (like a credit union).
For Davie title loans, specific to the state of Florida, it is generally LEGAL, but there are many laws and regulations to read about which were put in place to protect the borrower from predatory lender practices.
How Much Cash Do You Usually Get From an Auto Title Loan?
So, how much money can you even get from auto title loans?
As a general rule of thumb (though this may vary per lender), you can usually receive about 25-50% of your car’s value.
This loan type isn’t necessarily known for crazy high lending amounts, but they are convenient since you can receive cash FAST.
And honestly, maybe it’s a good thing that the amount isn’t that high because this type of loan is known to have a short period (usually spanning 15 to 30 days, but may extend further).
Logically speaking, it would be easier to repay a smaller amount, especially if the due date is relatively near.
Are All Applications Accepted Regardless of Credit Score?
No, this is definitely not the case!
Considering that there is an application process to apply for title loans, the possibility of getting rejected is still present.
While it is true that car title loans are a strong option for those with a bad credit score, a credit check may still be performed should the lender choose to do so.
Is There a Fee to Apply for These Loans?
Given that Davie title loans are accessible even to those with not-so-great credit scores, is it safe to assume that there’s no fee to keep applying for them? Technically, no.
It ultimately depends on the title loan lender and their policies.
Fortunately, many lenders have no application fees, but we cannot stress enough that it varies per lender.
What’s the Difference Between an Auto Title Loan, Personal Loan, and Payday Loans?
We’ve already discussed what vehicle title loans are, so this section will be dedicated to differentiating them with the concept of a payday loan and personal loan:
- Payday Loan – Much shorter than title loans, these loans often come with a repayment period of one to two weeks. So why is it called payday loans? Well, you eventually pay the lender back through a check (which could be from your well-earned pay from a tiring business day) or directly through your bank account. These loans are also known to have smaller loan amounts when compared to title loans.
- Personal Loan – These types of loans normally have set terms (and interest rate). Additionally, the loan term is much longer than title loans. In fact, a personal loan may last anywhere between 24 to 60 months! Furthermore, your credit score could greatly affect the amount you can receive.
Other than this, the main difference between title loans and other types is that the former uses a title as collateral.
We recommend that you review other loan types before settling with title loans and really consider what kind of terms would best fit your needs.
You and Davie Title Loans: A Match Made in Heaven?
After reading all of this, only YOU can decide whether Davie title loans would be beneficial given your specific situation and context.
But here are some helpful questions worth asking yourself:
- Did a bad business day lead you to look for extra cash outside of your job?
- Do you have a bad credit history that might pose a problem for other loan types?
- Are you aware of your car’s equity and value?
- How much money do you need at the moment?
There is no clear-cut answer we can provide for whether or not you should pursue an auto title loan.
But one thing is for certain: You now know what to look out for and how to approach Davie title loans properly!
With this knowledge, not only can you make a well-founded decision for your finances, but you can also make the most out of the title loans in your area!
Whether you apply online for a Davie title loan or choose to take a step back and give it more thought, we wish you all the best.