How is the Title Loan Value of My Car Determined?

If you are in a bind and need money quickly, a title loan can be a good way to take out a short-term loan. If you are considering going this route, though, you are probably wondering how the value of a car is calculated for a title loan. Because title loans let you use your vehicle as collateral, the amount of money you can borrow will be based largely on the amount your car is worth, as well as your own ability to repay the loan. It is important to note that there are two calculations to consider: the car value and the interest rate.

Calculating Title Loans

A title loan can be a good option for someone with shaky credit, but there is one important consideration: your car’s equity. If you owe more on your car than it is worth, you have negative equity and won’t qualify. Your income will also be considered when determining if you qualify for a title loan, because you will need to show that you can repay it. Assuming you do qualify for the loan, the amount of money you can borrow is based on a percentage of your vehicle’s resale value. This varies between lenders, but is typically about half of the car’s value. You can estimate this amount using online resources like Kelly Blue Book, but the lender will make the final determination. To do this, the lender will perform an inspection of your vehicle, and then come up with a value based on several factors, including:

• The make and model of the car
• The car’s current condition
• The mileage on your car’s odometer
• Any modifications
• The age of the vehicle

Calculating Payments

Your title loan payment will probably be a monthly payment, and will include interest and fees. Car title loans have higher interest rates than auto loans because they are short-term and considered to be a high risk for lenders. The interest rates and fees vary between lenders, so it is wise to shop around and find the best rates you can before taking out a loan. There will also be a finance charge, that covers application fees and processing fees. There can be late fees, too, so make sure you read the loan agreement carefully and understand all the terms and conditions before you sign. The interest and fees can add up quickly, so you will want to pay off the loan as quickly as possible, to save money.

When You’re Looking for a Title Loan, Trust VIP Title Loans

Where you get your title loan is an important factor in getting the best loan, at the best rate. At VIP Title Loans we offer the best rates in the industry, and if you compare us to other title lenders, you can verify that this is factual. We understand that getting the best title loan interest rate is important to you, and we value your dollar. That’s why we our rates are manageable, and our fees are lower than most other companies. We want to earn your business by saving you money, and with locations in Arlington, Dallas, Garland, Hickory Creek/Denton, and Richardson, we’re easy to find. Call us at 214-819-9491 or 682-325-4202, or contact us for more information.