March 25, 2023

If you need some cash to get you through some situation or another, you may want to consider a title loan. All you essentially need is a vehicle in your name with a clear title, and you can continue using the vehicle as normally while you’re making payments. But as a resident of the Yellowhammer State, you may be wondering whether you can even get a title loan in Alabama. Well, yes you can. Here’s how. 

Exactly What is a Vehicle Title Loan?

This is a short-term loan – typically 30 days or less — for which you put up your vehicle title as security. Loans for a year or so are also possible with some loan companies. And in addition to a car or truck, “vehicle” can often mean an RV, motorcycle, or boat.

How Much Can I Get?

This varies among companies and the state in which the lender is located, but the amount you can borrow basically depends on your income and your ability to repay the loan, as well as the vehicle’s value. The latter is determined by the ride’s make, model, age, overall quality, and mileage.

Having said that, most loans usually range between $100 and $10,000.

Title Loan Eligibility

In Alabama, you can apply for a title loan totally online, which speeds the entire process. It’s also possible among some lenders to get a loan even if the vehicle isn’t wholly paid off. Your chances for a loan are somewhat diminished, however.

If you do own the vehicle outright and there are no liens on its title, then all you really must do is provide proof of income, typically in the form of pay stubs. Alternative income such as from Social Security, pension, a lawsuit settlement, rental property, etc., will also work.

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You’ll also need a government-issued photo ID, and some lenders require proof of residence (utility bill, rental agreement, etc.), and professional or personal references.

Further, you must provide recent, quality photos of the vehicle from all four angles, plus the hood. You’ll also need shots of the vehicle identification number, the interior and odometer.

For title loans Alabama, borrowers are required to swear that the vehicle they’re collateralizing isn’t stolen. Lenders, meanwhile, are legally bound to provide details about monthly payments and fees. 

While you may be subject to a credit check, lenders don’t focus on what your report reveals. Because your vehicle serves as collateral, lenders aren’t all that concerned about your credit history. Just make sure you can repay the loan, though, because if you cannot, the lender will likely seize your vehicle and sell it to cover losses.

What About Interest Rates?

Vehicle title companies must disclose your loan interest rate, which you can expect to be competitive. After all, these companies are in business for your business, which you can take elsewhere.

Having said that, rates will vary, depending on the state in which the lender is located, as well as the lender’s discretion. Overall, though, the average interest rate is 25 percent of the loan total. Yes, this amounts to 300 percent annually, but remember that the loan term will probably be 30 days or less. That means you probably won’t encounter the whole 300 percent rate.

How Long is the Process

Not at all; in fact, it’s fast. Once you’ve submitted your application online, you can be approved that day. Once you are approved, you can have funds in hand by the next day via direct deposit, overnight check, or a local MoneyGram.

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So, you can certainly get a title loan in Alabama. If you’re sure you can repay the loan, just gather all required materials, and apply. You likely will be able to get a loan to get you out of a tough spot.