Can you get a title loan with bad credit?

Quick Answer Yes, you can get a title loan with bad credit. In fact, title loans are designed for borrowers with bad credit. Since the loan is secured by your title, your credit history is not a major factor. However, keep in mind that higher interest rates may apply due to the increased risk.

Kevin Johnson profile picture
Kevin Johnson â€ĸ Answer updated on Jun 14, 2023

Fact checked by Dwayne Dumesle

Whether you have bad or no credit, you can get a title loan.

Title loans are actually designed to help borrowers who have bad credit get the cash they need in a pinch. How is this possible?🧐

Learn: Where can I get a title loan?

Your credit score doesn't matter when you apply for a title loan! Title loans don't actually look at your credit history at all. Instead, lenders use your car title as collateral for your loan.

Here's how you can use your car to get a loan, even with bad credit:

  • You give the lender some basic info about your vehicle (year, make/model, etc.).
  • Someone from the lending company will check out your car to figure out how much it's worth.
  • You'll get a loan offer based on your vehicle's value, not your credit score. Title loans are usually up to 50% of the value of your car, but sometimes more. Cha-ching!
  • The lender will hold onto your car title, but you can still drive your car around like normal.
  • After you pay off the loan, you'll get your title back.

Your car title isn't the only thing lenders will look at, though. They'll also want to see proof of income since this shows you'll actually be able to pay off the loan. 💰

Learn: Can I get a title loan without proof of income?

While being able to get a title loan even with bad credit can be a big help, there are a few drawbacks to be aware of.

First, bad credit title loans usually have high interest rates (up to 300% APR).[1] This is a lot higher than other loan types because title loans are considered higher risk. You'll owe more in interest, which might be hard to pay off.

Also, if you don't pay off your loan, the lender can take your car!

So, even though a title loan can be a doable option for people with bad credit, it's a good idea to consider the risks before you sign any paperwork.


  1. What To Know About Payday and Car Title Loans ↩ī¸Ž

profile avatar
AD

My experience with Sound Financial has been absolutely incredible. I got the quick cash I needed without any hassles. The entire process was simple and transparent.