Pink slip loans are loans against a car title where you use your car as collateral to borrow the funds. You can get up to $50,000, or sometimes more, depending on the car’s value and what you can afford to repay.

The best part is you can keep driving your car as long as you make your required loan payments.

When considering a car’s pink slip loan, you can get money super fast, often by the next business day. However, remember these loans have high interest rates and fees and should only be used in financial emergencies 

At Montana Capital, we have title loan lending experience, helping vehicle owners access their vehicle’s equity. Contact us to learn more about using your car as collateral for a short-term loan.

Key Takeaways

  • Pink slip loans are short-term loans against your car title. 
  • Pink slip loans have high interest rates 
  • Should be used in emergencies only
  • You risk losing your car if you can’t repay the loan

What Is the Meaning of Pink Slips?

Pink slips are another word for car titles, thanks to the history of titles in the United States. Until 1988, the state of California printed certificates of title on pink slips of paper, giving them the nickname ‘pink slips.’

Many DMVs adopted the strategy because the pink pieces of paper were hard to overlook, making it easier for car owners to find their titles when needed.

Who Uses Pink Slips?

You might wonder when you’d use your pink slip after buying a car. If you’ve paid off your auto loan, you should keep your pink slip in a safe spot.

You might use your title or pink slip in the future in any of the following circumstances:

  • You sell your car to a dealer or private buyer
  • You want to refinance your car’s current loan
  • You need emergency cash and can apply for a title loan

What Are Pink Slip Loans?

A pink slip loan lets you keep your car and drive it while repaying the loan. However, the lender can repossess the vehicle if you don’t make your payments. Many people have taken advantage of this type of loan because of its accessibility and fast funding, especially during emergencies.

How Pink Slip Loans Work

Pink slip loans allow you access to fast cash. Title loan lenders determine the loan amount you may borrow based on the car’s value and your ability to repay the loan, most lenders allow loans equal to 20% – 50% of the car’s value.

With pink slip loans, you must repay the amount borrowed plus interest within the approved term. You keep the car as long as you make your payments, but you cannot sell the car until you repay the loan in full.

What Do I Need To Get a Title Loan?

You don’t necessarily need perfect credit to get a title loan, and your car doesn’t need to be a certain age.

Title lenders look at the big picture, assessing how much you can afford and how much your car is worth. 

To get a title loan, you must provide:

Do You Need Good Credit for Car Title Loans?

Some lenders pull your credit to determine your eligibility for car title loans, but many don’t use the credit score as a determining factor. Many car title loan lenders focus on the collateral, which is the car, and your income source, not necessarily your credit scores. You don’t need good credit for car title loans, as they are designed for borrowers with bad credit.

Do You Need a Job for Car Title Loans?

You must prove you have income for a car title loan, but you don’t necessarily need a job. If you have a steady income from another source, it may qualify you for the loan. Some common examples of other income include:

  • Disability income
  • Social Security income
  • Pension
  • Retirement income
  • Unemployment income

How Much Can You Borrow With Pink Slip Loans?

Every lender has different loan limits they allow, but in general, lenders allow up to 50% of the vehicle value. This is the case if you own a car without any loans.

For example, if your car is worth $15,000 and you don’t owe any loans, you may borrow up to $7,500 as a short-term loan as long as you can prove your ability to repay the loan.

The key is only to borrow as much as you absolutely need. You must also ensure you can afford the monthly payments.

How to Apply for Pink Slip or Car Title Loans

The nice thing is that it is easy to apply for a car title loan. Many lenders allow you to apply online without ever having to visit a branch in person. 

However, you can only work with a lender that is licensed to offer instant pink slip loans in your state. 

Here are the simple steps:

  • Apply online – The online application process takes only a couple of minutes. After entering information about yourself and your car, you wait to see if you’re approved
  • Get pre-approval – A lender will check your initial loan application, do a credit check, and evaluate your situation to determine if you’re a good candidate for a title loan. If approved, you’ll receive a pre-approval with the loan terms
  • Provide documentation – To move forward with the loan, you must provide your documentation, such as your income documents, personal identification documents, and information about your car
  • Send in your title – After approval, the lender will tell you how to send the vehicle title to them to fund your loan in exchange for the collateral
  • Receive your funds – Most lenders fund title loans within a couple of days of approval so that you can get cash fast 

Can You Get a Title Loan Completely Online?

It sounds crazy, but pink slip loans are available entirely online.

As long as you can provide accurate pictures of your car’s interior and exterior and proof of income, many loans for car titles are available without stepping in the lender’s door.

Who Should Consider Pink Slip Loans?

Pink slip loans are strictly for people experiencing financial emergencies who have poor credit scores and don’t qualify for other financing options. 

They help you get the funds you need fast, but are only suitable for borrowers who are capable of repaying the loan on time and who understand the possibility of losing their car if they don’t make their payment as agreed.

Alternatives to Pink Slip or Title Loans for Cars

Car title loan companies are one of many ways to get money for a short period. It’s a good idea to exhaust these options first before applying for a title auto loan.

  • Borrow from friends or family – Tell your loved ones about your financial emergency and see if they can help you with the funds. You can pay them interest and have a repayment plan, but you won’t have to worry about giving up ownership of your title
  • Personal loan – If you have good credit scores, you may qualify for an unsecured loan from a bank. These loans have higher interest rates than secured loans but with good credit, you can get rates lower than title loans. You also get a longer time to repay the loan, which means smaller payments and less financial stress. 


Where Can I Get a Title Loan on My Car?

Can I Get a Title Loan Online?

Are Title Loans Bad?

The Bottom Line

Pink slip loans, or title loans, help you access cash fast in an emergency. Getting a title loan means you put your car up as collateral but can still drive it.

A loan for auto title should be the last resort when you are in a financial bind. You can get title loans online fast if you have the documentation to prove you can afford it.

Written by Samantha Hawrylack

Written by

Samantha Hawrylack

Samantha Hawrylack writes for our company and is an expert in personal finance. 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.