Absolutely Essential Title Loan Terms And Definitions To Know

Title loans terminology can be confusing at times. Although the loan details can be filled with information about the loan interest rates, personal finance, and policy, nothing about the title loan process at Texas Car Title and Payday Loan Services, Inc. is particularly difficult to understand. We make personal lending as easy as possible and provide plenty of guidance every step of the way. 

In this article, we will explain the car title loan definitions, along with an essential glossary of title loan terms to make the process as simple as possible. When getting this type of loan, knowing the words you’ll come across will eliminate any unwanted surprises. So, if you are ready, here is a deep dive into the terms you’ll need to know.

Know These Title Loan Terms While Going Through The Car Title Loans Process

What Is A Title Loan?

First, you need to know the basics of these loans. As the name suggests, it is a loan on your car title— a cash flow option that lets you use the title of your vehicle as collateral to secure a loan. This is where it’s important to understand the term collateral. The title serves as collateral meaning it is an asset that secures a loan which reduces the risk for the lender. With a loan like this, the lender will put a lien on your title until the money you borrowed is repaid in full. If you do not make payment on the loan as agreed upon in the terms, then the lender has the legal right to repossess the car.

Doing so isn’t a malicious plot to steal your car; rather, it’s a way for the lender to protect themselves from borrowers who have no intention of repaying the loan. By putting the car’s title on the line, the borrower is incentivized to keep to the repayment schedule for the loan agreement. Don’t worry, though, at Texas Car Title and Payday Loan Services, Inc. we will never have you sign anything you’re not comfortable with, and you’ll reclaim your title once the loan is your payments are satisfied. In addition, you can continue to drive for the length of the loan while you make payments.

What Is A Lien-Free Title?

An important term for auto title loans, lien-free indicates that your car’s title has no outstanding debts, judgments, or legal claims from a third party on it. Liens may be placed on your car as a way of deferring ownership to the dealership, creditor, or, in some cases, local government until a debt is paid. For example, a lien may be placed on your car if you take out a loan to buy it. The lien signifies that the dealership has legal ownership of the car until you finish paying off the loan.

When you get a car title loan with our help, we will place a lien on your title until you’ve repaid the loan in full. That being said, we can’t place a lien on your title if you already have a lien on it. This is why you need to check your title and make sure that it’s clear. If you are unsure of how to do that or you find that you do have a lien on your title, you will have to go to the DMV to get that taken care of before you apply for a loan.

What Does Eligibility Mean?

Eligibility is another one of the title loan terms that is important to know and is something to consider when you apply. In short, it indicates what title loan requirements are needed to qualify, and if approved, the loan amount you can borrow, even with poor or nonexistent credit. 

We determine how much you can get based on your vehicle’s resale value and its condition. This is the reason we need to inspect the vehicle before we determine approval. Keep in mind that newer cars, luxury models, and cars that are well maintained will offer larger borrowing amounts since these cars have more value. Keep in mind that you should never borrow more money than you need. Use a calculator to determine how much emergency cash you need and what you can afford to repay before entering into any financial contract.

What Does The Title Loan Process Mean?

The last thing you need to know when it comes to title loan terms is the process. When we say “process” we mean the steps you have to take to find out if you qualify for this type of loan. The good thing is we make the title loan process as simple as we possibly can. And we also make sure to keep the list of title loan requirements short. First, make sure you have these items for us to determine if you qualify for approval:

• Driver’s license or state-issued ID.
• Lien-free car title.
• Your car itself for inspection.

Once you have the items ready, you’ll want to fill out the online form provided on our website to begin. This sends your information to the nearest store in Texas so that you can get connected with a representative who will help you through the rest of the process. Once done, you can expect a call to review the loan process, and the required items, and to set up your vehicle inspection either at the store or at a location of your choosing, such as your home or office.

Regardless of where you meet for the vehicle inspection, be sure to bring the necessary items for approval, so the representative can verify your documents before determining whether or not you qualify for the loan. If you’re all set, you’ll know shortly whether you’re approved and how much we can lend you. If approved, you will get your money on the same day or the following bank business day.

If you do not have the requirements for a title loan, you may want to consider a payday loan or installment loan with us at Texas Car Title and Payday Loan Services, Inc. 

Submit The Online Form Through Texas Car Title And Payday Loan Services, Inc. Today!

Now that you understand how these loans work, the important title loan terms you need to know to get started, and the car title loan definitions, you’re all set to explore this lending option when an emergency expense arises.

Life can throw a curveball at you and leave you reeling without a clear way forward. When that happens, you can use this title loan option to tackle large bills or important expenses upfront. If that sounds like the right option for you, then get started online today with our quick request form!

Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.