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How to Apply for Title Loans in North Carolina
Loans come in different forms, one of which is a car title loan.
Sometimes we may experience a shortage of cash and find ourselves searching for how to apply for a loan or which asset may be offered as collateral.
If you want to know more about what a car title loan is, and more specifically, how to get a North Carolina title loan, keep reading, and we'll guide you through the process.
What Exactly Are Car Title Loans?
A car title loan (also known as title pawns) is a short-term loan wherein the borrower uses their vehicle as collateral. In doing so, you give the rights of your car to another person or lending firm, also known as the lender.
In comparison to the process of applying for a loan at the bank (which may take days), you can turn your car into cash within the same day AND KEEP DRIVING IT. Convenient, right?
Car title loans also have a higher approval rate.
- Flexible payments may be arranged with your lender.
- Not all lenders will conduct a credit check. What a relief!
A bad credit score will not be a factor in getting approval for your title loan.
When your title loan is approved, the car title is given to the lender until the loan is FULLY paid. Most lenders usually have borrowers repay their debt within thirty (30) days.
It's best to make sure you return the money by the agreed date so the lender will not have to repossess your car.
Keep in mind: Some lenders may still want to look at your credit score before approving your title loan for their security, so be ready with it too.
Why Apply for an Auto Title Loan?
Car title loans provide an opportunity to borrow money fast.
It could be the best way to get your hands on cash if you find yourself in the shoes of someone who:
- Needs emergency funding for a project,
- Wants to have extra money for immediate payment (i.e., medical bill),
- Is in the middle of a big purchase that needs more funds, or
- Does not have enough credit left
Applying for a loan at a financial institution may run the risk of getting rejected, especially if you have a bad credit score.
If you're from North Carolina and considering applying for a loan, title loans have a high chance of instant approval. Who wouldn't want that?
Title Loan Requirements
Before you can apply online or on-site, of course, you'll need to prepare a few documents to qualify for a title loan.
See the list below before applying for a title loan in North Carolina.
First things first, before you can apply for a title loan, make sure you have a vehicle under your name. You cannot get a title loan using someone else's name.
Lenders will also look for the following details about your vehicle to determine how much cash they will loan you:
- Vehicle make
- Year vehicle model came out
- Vehicle model
- Car style
- Total mileage
Note: Car titles must be clean and free of liens.
Valid Photo ID
A valid ID is any card that shows your complete name, address, date of birth, and a photograph of yourself. The information here must match what is written on your vehicle title.
Acceptable identification cards are:
- A government-issued driver's license
- Up to date or most recent passport
Proof of Income
"Does this mean I have to be employed?"
No, you do not have to be employed. The beauty of title loans is, as mentioned earlier, the accessibility.
Any source of income that proves you will be able to repay what you borrowed is enough. Of course, this is also for protecting the one giving out the cash advance.
The lender may ask you to submit supporting documents like car insurance papers aside from the following:
- vehicle title
- identification card, and
- proof of ability to meet payment deadlines
Applying For Title Loans in North Carolina
Car title loans aren't available in certain states, and if you've done initial research on loans in North Carolina, you might be thinking: Aren't North Carolina title loans illegal?
Legality of Applying for Title Loans in North Carolina
In contrast with southern states like South Carolina and West Virginia, North Carolina banned title loans back in 2001, labeling them a debt trap due to the high-interest rates imposed.
The annual percentage rate for interest (APR) usually starts at twenty-five percent (25%), and the maximum APR allowed by North Carolina is until three hundred percent (300%) only.
Federal laws do not regulate title loans in North Carolina, and it's up to the state to have their regulations to ensure borrowers do not make loans they cannot afford.
Regulations by North Carolina on title loans determine:
- Limit on title loan amount
- Repayment terms
- Interest rate limit
- Whether renewals and rollovers will be allowed
- What to do in the event a payment is defaulted
You can read more about the regulations on this website for informational purposes.
Title loans are still illegal in North Carolina, but as long as the lender stays within the interest rates allowed by the state, title loans may be approved.
So, how does one get a North Carolina title loan?
Process of applying for North Carolina Title Loans
Similar to how numerous businesses are now present in the digital landscape, online loans may be made in just a few clicks.
Once you've decided on a service provider in North Carolina, you may already get the process of your application moving by doing the following steps:
- Go to the website or physical establishment where you would like to apply for a loan.
- Fill up the online application form or download it online (if available) and answer it before meeting with the lender.
- Submit your complete documents for the lender to verify your data.
- Once your request is approved, enjoy claiming your money on the same day!
Note: Process time may take anywhere 15 minutes to several hours
Frequently Asked Questions About Title Loans in North Carolina
How do I apply for a title loan online?
As mentioned earlier, thanks to advancements in technology, online title loans are just a click away. Visit the lender's website you plan on borrowing from and follow the steps listed.
In North Carolina, as long as you have a valid ID and a car title under your name, approval is almost always guaranteed.
I read that title loans are considered illegal in North Carolina. Does that mean I cannot get a title loan from the said state?
While the state law of North Carolina strongly stands against debt traps like title loans, it's not a closed door.
North Carolina frowns upon loans like these because of the high fees imposed on the borrower. Their remedy was to develop a set of regulations like a minimum and maximum loan amount that an individual may loan.
Stay within the boundaries of the North Carolina law, and you're good to go.
Note: The maximum loan amount will also depend on the loan term.
Can title loans be paid for in parts, or does it have to be in one go?
Some lenders may require you to repay the cash you borrowed in one go, while some will allow installment title loans. This really will vary depending on the one you are dealing with.
You may want to review your loan agreement before committing to anything.
How much can I get out of my car?
Typically, you will be allowed to loan around twenty-five to fifty percent (25-50%) of the total value of your car. That means you can get your hands on around $100 to $10,000, depending on your vehicle's condition.
What are the standard interest rates for title loans?
North Carolina only allows an APR of twenty-five percent (25%) to three hundred percent (300%). Lenders who ask for higher fees may be penalized if they go beyond this rate.
What are the repossession laws like in North Carolina?
If it isn't obvious yet, the North Carolina laws on title loans were made to protect the consumer from any unjust acts.
Applying for a title loan, while convenient, also imposes a risk on the borrower. Unlike other states that allow a grace period for a borrower to repay their loan, North Carolina does not practice this.
The regulations stipulate that the lender may repossess the vehicle and sell it to compensate for the money borrowed.
HOWEVER, the state will get to decide whether it can be sold and how much of the sale the lender may take.
Are there any alternative loans to auto title loans?
If you want to opt for another short-term loan, there is another loan you may try to apply for.
Payday loans are loans that last anywhere two to four weeks. These are also known as cash advance loans and do not rely on your credit history.
How does it work? There are two ways:
- The lender receives a personal check from you with the corresponding loan amount you want to borrow; or
- The lender is authorized to take the loan amount (plus extra fees, if any) from your bank account and credit it to theirs.
Important Notes to Remember
- Online title loans are convenient, but remember that your vehicle becomes collateral and not paying on time can result in it getting repossessed.
- Credit history isn't always checked, but the lender may ask for it.
- You must be at least 18 years old and a resident of North Carolina
- The vehicle must be under your name.
Our Final Take
Title loans in North Carolina are perfect for car owners looking for extra funds. It is quick, convenient, and considerate of those in financial distress.
You can fill up an application form online via the lender's website!
Those with good or bad credit are welcome to apply for a loan, making it inclusive for all walks of life. Lenders are also more welcoming, and payment terms may be negotiated.
Before applying for a loan, don't forget that your car becomes collateral and that not paying on time may result in repossession of your vehicle.
Did this article simplify the process of applying for North Carolina title loans? Let us know in the comments section below. Browse our website for more information.