Does My Car Need to be Paid Off to Get a Title Pawn?

If you’re considering a title pawn but don’t know if your car needs to be paid off first, this article is for you. We’ll answer the question of whether you need to have a paid-off car to get a title pawn. 

If you’re still paying off your vehicle, you might think that you can’t use it as collateral for a title pawn. However, this isn’t always the case. Some lenders may be willing to offer you a pawn even if you’re still making payments on your car. 

To qualify for a title pawn while still paying off your vehicle, you’ll need to have equity in the car. Equity is the portion of the car’s value that you own outright. For example, if your car is worth $10,000 and you still owe $5,000 on it, then you have $5,000 in equity. 

Some lenders may only be willing to offer pawns if you have a certain amount of equity in your car. Others may be more flexible and willing to work with you even if you don’t have a lot of equity. 

Finally, it’s important to remember that a title pawn is a secured financing option. This means that if you default on the pawn, the lender has the right to repossess your car. So, if you’re considering a title pawn, be sure that you can afford the monthly payments and are comfortable with the risks involved. 

How Much Can I Borrow with a Title Pawn? 

Assuming you have a clear title to your vehicle, most title pawn companies will lend you 25% to 50% of the wholesale value of your car. So, if your car is worth $5,000, you could borrow anywhere from $1,250 to $2,500. Of course, the amount you ultimately receive will also depend on the lender’s policies and your ability to repay the pawn. 

While 25% to 50% may not sound like a lot, it can still add up to a significant amount of money – especially if you need money fast. And because title pawns are typically due in full within 30 days, they can be a good option for those who need short-term financial assistance. 

Of course, as with any type of financing, there are risks associated with title pawns. One of the biggest risks is that you could lose your car if you can’t repay the pawn. That’s why it’s important to only borrow what you can afford to pay back and to make sure you have a plan in place for repaying the pawn on time. 

If you’re considering a title pawn, be sure to do your research and compare offers from multiple lenders before deciding. And remember, as with any type of financing, be sure to carefully consider the terms and conditions before signing on the dotted line. 

What is Required to Qualify for a Title Pawn? 

If you’re considering a title pawn, there are a few things you’ll need to bring with you to the lender. Here’s what you’ll need to qualify for a title pawn: 

Your car’s title – This is perhaps the most important item you’ll need to bring with you. Your car’s title must be free and clear of any liens or encumbrances. As stated above there are lenders who will still allow you to qualify for a title pawn If your car is still being financed.  How much you can borrow will be based on the remaining equity in the vehicle as referenced above. 

A government-issued ID – You’ll need to show some form of identification to prove that you are who you say you are. A driver’s license or passport will suffice. 

Proof of income – The lender will want to see that you have a steady source of income to make sure you can repay the pawn. Pay stubs, bank statements, or tax returns can all be used as proof of income. The vehicle itself – Of course, you’ll need to bring your car with you when you go to get a title pawn. The lender will need to inspect the vehicle to determine how much they’re willing to lend you. 

If you have all these things, you should be able to qualify for a title pawn. Just remember to do your research and shop around before choosing a title pawn lender. And always be sure you can repay the pawn before taking one out.