Car Title Loans in Alaska: Get Quick Cash Today!
Is your credit score making it difficult to get a bank loan or borrow money from a credit union?
A handful of cash loans you can apply for, such as car title loans in Alaska, would be perfect for your situation.
A car title loan offers a fuss-free application process, and you can even get your money on the same day.
Read on to get the complete picture, and let's get your loan money today!
Answering Your Car Title Loans Inquiries
Are you concerned about your credit score and how it can affect your application? Worried you might need more cash than what the loan can provide?
If you are unfamiliar with car title loans and how they work, we got you.
Let's discuss the A-Z in this section, everything from what a title loan is, to its benefits over other similar loans.
What Is a Car Title Loan?
A car title loan is a short-term cash loan for which you use your car as collateral. It is perhaps the best kind of loan to get you out of a financial jam.
In exchange for the money, the lender will require your car title and will be the vehicle's legal owner for the duration of the loan.
Car title loans may also be known as auto title loans or pink slip loans (pink slip as in a car title, not an employment dismissal).
It is an excellent option for those that are unable to approach a credit union because of their bad credit score.
Other than its accessibility, borrowers of title loans appreciate how quickly they can get their hands on the cash.
Many of the lenders in Alaska are able to give borrowers their loan money on the same day or the next business day.
Other financial institutions require a lot of back-and-forths just on the application stage. Getting approval could sometimes take even longer.
What if I Have Bad Credit?
For many of the loans out there, a borrower's credit score matters because lenders like banks would not want to risk their investment on someone with poor payment history.
If you have a bad credit score with any of the three large credit bureaus (namely TransUnion, Equifax, and Experian), it might be hard for you to come by legitimate loans.
Thankfully, a bad credit score WILL NOT hinder you from getting your hands on the money you need to finance an emergency.
This is one of the main benefits of title loans.
However, lenders might still run a credit check as a person's credit score could affect other loan details.
For example, a credit score may influence the rate that lenders will set or the payment plan of title loans.
There is a good chance that people with a better credit score can get lower interest on their loans than those with a bad credit score.
In addition, do note that your credit score will most probably neither be built nor damaged by the outcome of title loans.
How Much Cash Can I Get From Alaska Title Loans?
Per Alaska's state laws, a person applying for a car title loan can borrow from $100 to $50,000.
However, the final amount you can obtain from your car title loan will depend on how much money you request and the lender's assessment of your vehicle.
If you want to calculate the possible maximum loan amount you can apply for, you have to know your car's equity.
To do this, you will need to find out the resale value of the car you intend to use as collateral. If you still have some payments due for it, subtract that from the resale value.
The difference is the vehicle's equity. It's important to be aware of this because that is the basis of how much you can get from your title loans.
Suppose your car's equity is $20,000, and your loan provider can let you borrow up to 50% of that. The maximum loan amount would then be $10,000.
Additionally, just like how your credit score will not prevent loan approval, generally, credit should also not be a determining factor in the loan amount.
What Are the Interest Rates for Alaska Title Loans?
According to the official regulating body, the Annual Percentage Rate of Alaska title loans averages 300%.
Title loans are undeniably more expensive than bank loans that offer lower interest.
While title loans are secured by a vehicle, neither this nor the car's resale value affect the rates set by lenders.
With a bank loan, for example, you would be borrowing against your credit score instead of collateral.
However, despite being an unsecured loan, banks are more assured by the borrower's creditworthiness based on their credit score and credit history.
Providers of title loans, in turn, take risks when lending money to a person who is considered to have poor payment history due to past credit events.
This is why title loans have high interest on top of their short-term nature. Just be sure to pay your loans on time. Otherwise, your vehicle might get repossessed by the lenders.
Am I a Qualified Applicant for a Car Title Loan in Alaska?
We have already discussed how having a poor credit score will not get in the way of approval of title loans, but other than this, just who can apply?
Seeing how high the approval rates are, it is easy to see that Alaska lenders are willing to provide title loans to different kinds of people.
Keeping that in mind, there are state laws in place that impose guidelines on who can be granted title loans.
See these guidelines below to find out if you qualify as an applicant:
You Qualify if You...
- Are at least 18 years old at the time of application
- Are a citizen of the state of Alaska
- Have a vehicle and its title, which names you as the legal owner
- Have had a stable income stream for at least the past six months*
NOTE: This is a requirement because lenders need an indication that you can pay for the loan.
Your Car Qualifies as Collateral If...
- Its title is lien-free at the time of application
- It has enough value in equity and no outstanding credit attached to it
Unlike bank loans, they are not stringent about credit scores and have a significantly easier and faster process as long as you meet these requirements.
How to Apply for Car Title Loans in Alaska
Have you decided that applying for title loans is the best course of action for your financial problem?
Don't let your poor credit score get in the way of getting some help! Here's what you should do to secure a title loan:
Step 1: Find a Lender
Title loans services do not vary much between different lenders, but it is crucial to find one that can suit your needs and capabilities.
Firstly, go for a reputable lender that can provide you with legal documents that put you at ease. They should let you know you are dealing with a legitimate loan provider.
Next, find a lender who can provide you with a loan that matches the amount you need, the interest you are comfortable with, and a payment term you can commit to.
You may also check if your credit history or credit score affects their process.
Finally, if possible, choose the agent you are comfortable with.
This person will do business with you for the duration of your loan, so it would be good to know that you can communicate issues with them if any arise.
Once you pick the best lender for you, go to the loan agency and begin the application process.
Step 2: Ready the Necessary Documents
The application process will likely vary depending on the lender of your choice. We will describe the process here in a general manner.
Typically, the loan agent will have you fill up an application form to gather your basic information.
After doing so, you will be asked to present the documents required to move the application process along.
The particular required documents may be different from one lender to the next.
We came up with a list that shows the ones that most providers would need to verify the information you give. Prepare the following documents below:
- A valid government-issued ID: Depending on the lender, they may specify which ID to prepare and ask for your driver's license.
- Title of the vehicle to be used as loan collateral: It must be lien-free and names you as the car owner.
- Proof of steady income: You do not need to have formal employment. Alimony, child support, etc., are accepted.
Other documents may include:
- Mail as proof that you are a resident of Alaska
- Vehicle documents like car insurance and registration
- Social security card
- Bank account details
Step 3: Vehicle Inspection
If your car qualifies as collateral based on its equity, it will be inspected by the lender.
They will check the car's condition, its mileage, the year it was manufactured, and the make and model.
If you have made improvements on the car's interior and exterior, these will also be examined and taken into consideration.
The inspection determines the amount of money you can borrow through the loan and whether it matches your request, if it does not, or exceeds it.
Remember that your credit score or credit history should not play a factor in working out this figure, as it will depend on your car's resale value.
They may affect the interest, not the car's resale value or equity.
If your loan agent has decided on the loan amount and it at least matches your requested number, you can proceed to the next stage of the application.
Step 4: Wait for Car Title Loan Approval
Most of the loan's details have already been determined on the lender's end.
The amount, the interest, the payment terms, and other fees or charges should be communicated to you.
If you have any issues or requests, bring them up to the lender so they can address your concerns.
If, for example, you prefer to pay for the loan in a lump sum or one-time payment, let them know.
Or, if the rate given to you is higher than you are comfortable with, try to let the lender understand your situation, and they may be able to lower it for you.
When all details have been agreed upon, the loan agent will have the application processed for approval.
This should not take very long; some loan providers claim they can make this happen in as quick as 15 minutes!
Step 5: Receive Your Cash!
If your loan application gets approval from the lender, congratulations!
Your loan money could be transferred electronically through a direct deposit or cold cash if preferred.
Expect to get your hands on it on the same day or the next business day.
Online Title Loans in Alaska
Title loans have become even more convenient and accessible since lenders began to make the service available through the internet.
You can apply for title loans online if you want it done from the convenience of your own home or anywhere else you can access lenders' websites.
Borrowers who cannot spare the time to visit the lenders' physical store can now apply online and go through the process on their website.
As for the vehicle inspection, some lenders will be satisfied with pictures of the car, its odometer, and other specifications.
If you choose to transact with loan providers online, note that you need an active bank account.
Through that, they can make a direct deposit of the loan amount electronically to your account. It can likely be done on the same business day as your application.
Like an in-store application, credit history and credit score should not impede approval.
What to Keep In Mind Regarding Online Loans
Though getting title loans online is helpful for many applicants, some risks accompany it.
Many loan providers have extended their operations online, but some may only be pretending to be legitimate but are running scams.
Be extra careful with who you transact with, as car title loans require plenty of personal information that these "lenders" could use maliciously.
As a precaution, look for legal licenses on their website to check their legitimacy.
If none are available, please ask for these documents via email, which you should provide on their website.
Feel free to double-check with the Division of Banking and Securities of Alaska's Department of Commerce for your peace of mind.
Making Payments for Your Car Title Loan
Repayment terms are a critical detail that could be one of the things that decide just which loan provider you'll go for.
Regarding the payment plan, remember that car title loans are SHORT-TERM loans, which means the life of the loan will not last an extended period.
The usual arrangement for title loans is for them to be paid in full, one-time, after 30 days.
This is a good option for those who can afford it and want to quickly lift the burden of having a loan off their shoulders.
In Alaska, however, there is an option for installment title loans which you can repay in fixed amounts over 3-6 months.
If you expect that you will not be able to pay in the typical 30-day period, go for paying in installments to close the loan comfortably.
Though title loans will not affect credit score, it is still essential that the borrower consistently makes payments.
It is not advised to be behind in your debt payments.
A Few Alternatives to Car Title Loans
In the State of Alaska, pink slip loans are not the only loan type you can access if you cannot get unsecured loans with a credit union.
When faced with financial problems, it's good to have options for where to source the money you need.
Check out these other bad credit loans you can apply for:
Among the alternatives we will explore, a payday loan is the one most similar to a car title loan.
It is a short-term loan you can get even if you have a bad credit score.
Because providers of this loan typically engage borrowers with bad credit and poor payment history, its interest rate is also high to account for the lenders' risks.
Payday loans are advisable for those who need money fast but not a lot of it as, generally, the maximum loan amount goes only up to $500.
In exchange, you only need to issue a personal check for the loan amount, plus fees or give authorization to the lender to take the money from your bank account.
As for the duration of the loan, you need to be able to pay it back by the next payday, hence its other name of cash advance loan.
You do not need to put down an asset as collateral to be able to qualify for this loan.
Usually, providers of personal loans will consider the borrower's credit score to give approval.
However, some Alaska lenders can grant loans to borrowers with bad credit scores.
Unlike payday loans and car title loans, personal loans fall under the category of installment loans.
Payments are typically made over a more extended period; for personal loans, borrowers pay fixed amounts.
The amount you can get from personal loans is significantly higher than from payday loans, going up to five figures.
Borrowers of this loan can finance bigger projects such as major home repairs or even purchasing engagement rings.
Others also use a personal loan to consolidate other borrowed money, such as credit card debt. This allows them to pay it off simultaneously.
Now, you may be surprised to see student loans on this list as it is not considered one of the bad credit loans.
Getting a student loan will also affect your credit score if you cannot pay accordingly, unlike getting a car title loan.
However, if you are taking on loans to pay for school tuition, this is advisable over other, riskier loans.
For one, the interest rate is significantly lower. You can also make payments in portions for a very extended period.
For another, you do not need to have an asset to borrow against as a loan requirement.
This loan has few uses besides funding school tuition and other student-related expenses, which creates fewer distractions for you if you're taking loans for educational purposes.
There is no need to worry about pressing payment deadlines and defaulting immediately.
Frequently Asked Questions
We have already delivered a bunch of information thus far, but there's still more to know!
Thankfully, this section has you covered with answers to the questions we might have missed out on earlier.
Check out these FAQs so that you are equipped with all the information you need.
Can I Keep Driving the Car I Used as Collateral?
You can keep using the vehicle as you normally would even while it's used as collateral.
For the duration of the loan, the lender will keep the car title and not the car itself. It is important to know car title loans do NOT involve pawning off the borrower's car.
You do not need to surrender your assets for secured loans as long as you make payments.
In addition, there is no reason for them to collect your driver's license so that you may drive your vehicle like usual.
It is advised to do so carefully to ensure the car still has enough value by the end of the loan.
Who Regulates Title Loans in Alaska?
Alaska's Department of Commerce, Community, and Economic Development serves this function, specifically their Division of Banking and Securities.
They are the official body that decides the interest rates for car title loans in Alaska.
They dictate the minimum and maximum amounts of car title loans and loan terms (the life of a loan), among other things.
The Department is also responsible for legitimizing and regulating the various companies that offer car title loan services.
You must check to see that the Department recognizes your chosen lender.
If they are not, look for a different loan provider as they may be operating illegally. Feel free to send a report to the Department if this is the case.
What Happens if I Can't Pay For My Car Title Loan?
Auto title loans have plenty of advantages, but they can also be very tough on borrowers if the loan has defaulted.
Car title loans typically have a repay or repossess policy, which is legal in Alaska.
This means that if you cannot make the appropriate repayments for your car title loan, the lender may repossess the collateral vehicle.
If this happens, they might sell it and use the profit to pay for the outstanding balance of your loan.
You want to avoid this scenario as much as possible, so be smart about applying for car title loans or any kind of loan.
It is ideal that a borrower consistently makes payments to avoid building bad credit and having to default.
Depending on the lender, they may also allow your debt to roll over, which will have you paying additional fees on top of your existing debt.
Can I Have Two Car Title Loans in Alaska at Once?
You can have two car title loans simultaneously if you have a different car for each loan.
If both cars have clean titles that are named to you, this is a possibility.
You cannot use the same vehicle as collateral for two separate car title loans per Alaska's governing laws.
As a car title loan is a short-term loan with high interest, the state is very likely restricting this to protect consumers from getting buried in expensive debt.
Additionally, a single car probably does not have enough value to match or exceed the value of a loan twice over.
So, from a mathematical standpoint, it does not seem like a viable investment on the part of the lenders.
Are Car Title Loans Better Than Bank Loans?
The answer to this question entirely depends on the factors you are looking at or why you want a loan.
Credit score, for example, plays a huge factor in which loan you can access.
There are reasons why either kind of loan could be advantageous. See below which situation fits you the best.
Choose a Car Title Loan If...
- You are interested in a quick application process
- You need the money from the loan within the same business day
- You can keep up with payments of short-term loans
- You find yourself with a bad credit score or have significant credit card debt
Choose a Bank Loan If...
- A good standing will come from a credit check with any of the three large credit bureaus
- You are interested in loans with lower interest
- You have time to complete the long application process and get the loan money
- By your estimation, you will need a more extended period to pay for the loan
If you need to get money fast, car title loans are a GREAT OPTION because you can claim your money from these loans on the same day you applied.
A bad credit score will not hinder your approval because the loan is secured using your vehicle as collateral. Just make sure that you understand what you're getting into.
Feel free to return to this article if you need a refresher on all aspects of car title loans offered in Alaska.
Best of your luck on your title loan applications!