Title Loans in Georgia: Is It Legal and How Can I Apply for One?
Are you in a sticky financial situation?
Maybe you’ve heard of car title loans before, but you’re not exactly sure how they can help you.
This is where we come in…
Here is everything you need to know about securing title loans in Georgia.
After reading this, you’ll know if getting a title loan is the solution that you’re searching for.
First Things First — What Are Title Loans?
The first thing you should know is the terms title loans and title pawns are often used interchangeably in Georgia.
The basic definition is this: when you’re applying for a car title loan, you are giving the title to your vehicle to secure a loan.
You don’t need to actually surrender your car so you’re still allowed to drive it before the repayment date. This makes title loans very attractive to borrowers.
These title loans usually have to be paid in a short period of time and the amount that you can borrow will be determined by your car’s value, among other things.
Other Important Facts
If you are unable to make payment within the deadline, the lender has the right to repossess your car and sell it. That is why it’s very important you know you are able to actually pay off the loan BEFORE you settle on an agreement.
There’s one major reason why some borrowers find great value in title loans compared to others.
It’s actually known to be a very quick and easy solution to get cash loans — You can usually receive the title loan proceeds within a day of your application.
Because of this, a car title loan or title pawn is usually used to address short-term financial problems (like emergencies or urgent payment deadlines).
Is It Legal to Apply for Car Title Loans in Georgia?
Yes, title loans are legal in the state of Georgia. These types of loans are governed under the laws of pawn brokering.
The logic behind this is that engaging in title loans is similar to pawning. You’ll be giving the lender the vehicle title to get a loan.
Of course, there are a few legal considerations in the state of Georgia. One of these is that you must be of legal age (which is at least 18 years old).
How Can I Apply for a Title Loan/Title Pawn in Georgia?
Here are the necessary steps you need to take to apply for a title loan or a title pawn in the state of Georgia:
1 . Research on Your Preferred Title Loan Lender
Lending companies in Georgia may differ in specific title loan amounts, terms, and quality of service.
Do your due diligence first so you can enter into an agreement that is right for your specific needs.
First, you must determine if the organization is a legitimate and licensed title loan lender. This means that all its practices are regulated and standardized by the government and Georgia law.
Entering into a car title loan already means you are having some financial trouble. The LAST thing you want is to be caught in an even worse legal situation just because you didn’t take the time to research.
2 . Fill Out Application
Once you’ve decided on a lending service in Georgia, get in touch with them and start the process of filling out the application.
Loan lenders will ask you to be transparent about your personal information and vehicle details (car model, condition, make, etc.)
3 . Submit Requirements
These are the general documents you need so you can apply for a title loan in Georgia:
- Government-issued identification card (such as a driver’s license, passport, social security card, etc.)
- Proof of residence (bank statement, utility bill, etc.)
- Proof of income
- Vehicle Title
Before you submit your requirements, there are a few things you need to know first:
- You are not required to have a job when you submit your proof of income
- Second, you must also be the owner of the vehicle you are trying to use as collateral. In other words, you are the legal holder of the title of the vehicle. This means that you are not allowed to use a leased vehicle.
- Your lender may also ask for additional documents aside from the ones listed above. This would depend on its own rules and guidelines.
- After you submit all of the requirements and information, the lender may perform a credit check.
4 . Get Your Vehicle Inspected
Some lending services in Georgia may require you to bring your vehicle for an in-person inspection. \
Keep in mind not all lenders consider this a necessary step. Make sure to read the instructions of your lending service carefully.
5 . Review the Loan Contract
Okay, so this is where it gets a bit more technical.
To make sure your contract is valid, you have to have to be familiar with Georgia law:
The following should be clearly specified in writing:
- The lender’s name and address
- A statement advising you that the lender can repossess your car if you are unable to pay
- The amount that must be paid in total
- Date of repayment
- Length of the loan
- Interest rates (for the first 30 days and for each 30-day extension)
- All other fees
The state of Georgia does not impose any limitations on the title loan amounts. This would be determined by your agreement with the lender.
Your lender will consider your ability to repay and the value of your car.
You should also manage your expectations — it is very unlikely that lenders will give you an amount that is near your car’s total value.
Georgia law specifies that for the first three months, you cannot be charged an interest rate of more than 25% of the total title loan/title pawn amount.
Once you exceed the three months, lenders cannot charge you an interest rate of more than 12.5% per month.
Loan Terms and Conditions
Georgia requires the minimum term to be 30 days. The repayment date can also be extended 30 days at a time.
What if payment can’t be made?
If ever payment can’t be made, Georgia allows a grace period of 30 days for the borrower to repossess the vehicle.
Okay, so let’s say you were able to take your car back during this grace period. You will still be at a loss compared to if you paid within the deadline.
Why is this the case? It’s because of the additional fees that this will incur:
- The loan amount and the corresponding interest
- Storage fees (up to $5 per day)
- Repossession fee (up to $250)
The bottom line is although there is a grace period, you’d still want to meet the original deadline at all costs.
If you are still unable to make payment, Georgia law allows the lending service to seize your vehicle immediately after you miss the deadline.
The lender can also make all efforts to sell the car in order to make back what you owe. Once the vehicle has been sold, the lender can only take what is due to him.
This means that after the loan, interest, and fees have been deducted, you can avail of the excess amount coming from the sale.
Overall, you have to make sure your contract abides by Georgia law. This is to keep you protected against deceitful and illegal practices and that you can also be aware of the lender’s rights.
5 . Claim Your Cash
Congratulations if you’ve made it this far!
After you’ve reviewed the contract and made sure that it is up to Georgia legal standards, you can now claim the cash you need.
The method of disbursement will depend on your lending service, so make sure to read up on that first.
Car title loans/title pawns are known to be quick and easy. We can’t guarantee anything but you can usually receive the cash within 24 hours.
Does a Title Loan/Title Pawn Require Credit Checks?
Title loans have quite the reputation of not requiring a credit check. Some would even say that your credit score is not a factor at all when it comes to title loans. This is NOT accurate information.
Lenders MAY still take credit scores into account when deciding the loan amounts and interest rates that they’re willing to give you.
To clarify, if you don’t have the best credit score, it doesn’t mean your title loans will get disapproved.
BUT having a low credit score doesn’t mean you’ll automatically be approved either or that you’ll be given a good interest rate for it.
It’s best to ask your specific title loan lender in Georgia for more information on how credit scores are taken into consideration.
Which Vehicles Are Acceptable for Title Loans in Georgia?
In Georgia, you can get title loans for any type of vehicle as long as you have the title to it. In other words, you have to own this vehicle outright and it has to be lien-free.
Are Title Loans Better Than Bank Loans?
This would depend a lot on your personal circumstances. What we can say is that a lot of people choose title loans because it’s a very fast and easy way to get cash.
Banks typically take a longer time to approve your request for loans. Bank loans are also known to be more strict when it comes to reviewing your credit score.
Final Words on Title Loans in Georgia
In summary, it is legal to apply for a title loan/title pawn in Georgia.
However, before you go rushing to apply, it’s important that you research first on your preferred lender. You should also take into consideration your credit score and the value of your vehicle.
This also includes the following:
- It is important you extensively review the loan contract to check if all the conditions are legal and suitable to your personal situation.
- Aside from the amount, you must fully understand the stipulated interest rates, payment terms, any additional fees.
After accomplishing all these steps, you are now ready to complete the agreement and receive the loan proceeds.