Auto Title Loans in Illinois: Steps, Requirements, and FAQs
Our life now cannot function without cars and other such vehicles, which explains why so many people own them.
If you own the title free and clear, you can use a vehicle as collateral for small title loans in Illinois because they have resale value.
Because lenders have the security in the form of your car, as opposed to conventional monthly loans, car title loans enable you to borrow more significant sums and get cash advance.
What Is a Car Title Loan in Illinois?
An auto title loan in Illinois is a brief loan secured by your qualified automobile.
The lender takes possession of your car title after processing your application for a car title loan and holds it as a lienholder until you repay the total amount of the loan, plus interest and fees.
The good news is that you can continue to drive your car while making payments on the loan.
What to Know About Car Title Loans?
Title loans are generally short-term loans. Typically, they last 15 or 30 days.
Your car, truck, motorcycle, or other vehicle is used as collateral for your car title loan.
They are often for sums between 25% and 50% of the car's value.
The average monthly finance charge for title loans is typically 25%, translating to an annual percentage rate (APR) of roughly 300%.
Other fees, like processing, document, and loan origination fees, are frequently added to the loan amount by title lenders.
You could also need to purchase extras like a roadside assistance plan. The cost of your loan will be HIGHER if you have to buy extras and pay additional fees.
Most qualified borrowers can get cash from a title loan provider in Illinois within ONE BUSINESS DAY.
What Information Should I Look for if I Apply for a Title Loan?
The lending company must disclose the cost of a car title loan in writing before you sign the loan agreement, as federal law requires, much like other forms of credit.
Illinois title loans are required to disclose the APR, a percentage, and the finance fee, a monetary amount.
The APR is determined by the total amount borrowed, the monthly finance charge, any additional expenses (such as processing or document fees), and the length of the loan.
To compare the cost of borrowing money from traditional bank loans, use the APR. It provides the most precise picture of a loan's cost.
How Do Car Title Loans Work?
A title loan company requires a single payment, which means the borrower must repay the entire loan amount plus the interest fee within a month or so.
Before you get that loan, think of the following:
- Determine how much you require.
- Complete an application form in person or online in an Alabama shop near you.
- Give the lender the title to your car as collateral.
- Receive 25 to 50 percent of the car's value the same day in cash or in your bank account.
- Pay back the total amount of the loan.
Single-payment title loans have an average APR of 300 percent, similar to payday loans. They are repaid in full within 30 days.
Installment title loans are available, which are similar to personal installment loans in that they have an average APR of 259 percent and more flexible payment terms of three to six months.
An example of a loan process:
- If you need a 30-day loan with a maximum loan amount of $1,000, the finance charge is 25%.
- In other words, it costs $250 to borrow $1,000.
- The lender provides you $1,000 in cash in exchange for the title to your car.
- Then, you must pay a minimum loan amount of $1,250 in addition to any extra costs the lender imposes when it comes time to repay the lender in 30 days.
Pros and Cons of Title Loans
We all fall into situations where we are just a little short on cash. Let's examine the advantages and disadvantages of getting title loans in Illinois.
Advantages of Getting an Illinois Title Loan
Car title loans offer a quick way to get cash fast. Let's explore the benefits.
1: Easy Access
Anyone who owns a vehicle is eligible to apply for this loan.
Nothing can stop you from applying for the loan if you are of legal age, regardless of your financial situation, place of worship, geography, or line of work.
The lender qualifies you as long as you offer a vehicle as SECURITY.
2: No Credit Check
The main selling point of title loans is that your credit score is not required.
For auto money title loans, your credit score has NO BEARING on the amount of the loan or the cost of the loan, unlike with traditional loans.
Whether you have a poor credit score or none, it makes no difference.
NOTE: Lenders may still do credit checks. You can still apply with a bad credit score, but those with better credit will get better offers and lower interest rates.
3: Keep the Asset
You get to keep and use the asset even though you use the car as collateral.
For their security, some lending companies might put a GPS in the car, but all companies that offer title loans will let you keep the car.
In this manner, you AVOID giving up your car, which acts as a security for your loan.
Disadvantages of Getting an Illinois Title Loan
Getting cash fast is a dream for many. But, these loans are paid very quickly. Let's look at the drawbacks of getting title loans in Illinois.
1: Limited Payback Options
Unlike regular loans, you are NOT ALLOWED to talk about the choices for repayment. The best lender will set a specific deadline for your payment.
Even if you have a legitimate issue, you will still be charged extra interest if you go over it even by one day. Typically, this is fourteen or thirty days.
2: Endless Debt Cycle
One of the leading causes of people losing ownership of their vehicles is due to title loans. Auto title Loans are where most people in a debt cycle begin.
Before you embark on any high-risk money lending scheme, ensure you know what you're getting into.
3: Potential Asset Loss
If you cannot make payments, the lender has the right to sell the car and recoup its losses.
The loan is frequently twice the car's value, so the lender makes a profit.
On the other side, the client forfeits the automobile. You'll probably lose the car if you can't make the payment, and the lender won't let it roll over.
Before You Take Out a Title Loan
Never take out a title loan in Illinois unless you have a true emergency.
Consider other options before taking out title loans. You can also take a credit check, fast cash, and title pawns.
Borrowing from friends or family, visiting your local credit union, and setting up a payment schedule with your creditors are safe, good credit decisions.
REMEMBER: Do not take out a title loan unless all other options have failed.
Know exactly how much you'll have to pay each due date before you sign, and make any necessary adjustments to your budget to make sure you can pay the balance owing and on time.
Otherwise, you might have to settle with high-interest rates in the future.
What to Keep In Mind When Getting an Illinois Title Loan?
We encourage you to make the required repayment in full and on time since these companies want you to keep ownership of your vehicle title.
Did you know? Most qualified borrowers can receive cash within one business day!
When you apply for online title loans in Illinois, you can get cash loans on car titles (title pawns) bearing these things in mind:
1: Take Out Only What You Need
A SMALLER LOAN would be simpler to repay and less likely to result in the loss of your car. You'll need to commit to monthly payments.
Again, only take out a loan if it's a real emergency.
2: Pay Back What You Owe
Although the lenders might be able to sell the car to recoup their investment, they would prefer not to.
They want their customers to keep control of their vehicles and make timely loan payments.
You are also responsible for paying any additional expenses to retrieve your vehicle.
3: The Vehicle Is Still Usable
The car is with you while the vehicle title is in their office.
Throughout the loan term, you can use the vehicle without any issues, and when the loan is repaid, they will return the title to you.
The Cost of Auto Money Title Loans in Illinois
A title loan can be a fantastic option to secure a loan if you know how it works and is sure you can adhere to the repayment plan, especially if your credit score isn't excellent.
Here are the THREE primary expenses that you need to be aware of according to the financial and professional regulations:
- Interest rates
- Finance charges
- Title certification fees
Try to stick to the deadline since if you wait another month, you will have to pay more for processing and fill out more paperwork to get the title loan in Illinois to roll over.
What Are the Requirements for Car Title Loans in Illinois?
According to the Illinois Department, a loan representative must have a reliable source of income and a valid ID in addition to a title for a paid-off vehicle.
If you need any help getting your title updated, you should contact the Illinois Secretary of State at the following address: Illinois Secretary of State Record Inquiry Section 501 South Second Street, Room 408 Springfield, IL 62756-8888 Phone: 217-785-3000
Most candidates will be able to demonstrate their income using a W2 from prior employment or business in addition to the bank statements from the previous month.
An onsite representative in Illinois from the financial and professional regulation typically needs an hour to walk through the procedure and determine the total loan amount.
In some circumstances, you might also be required to provide evidence of current insurance, and of course, any Illinois-licensed title loan provider would want to examine the vehicle.
In some circumstances, you can have a qualified vehicle inspector come to your workplace or home to finish the inspection quickly.
The lending company can do the car examination at any Chicago walk-in site or at Quincy or Aurora, IL offices.
A List of Documents You Need for Title Loans in Illinois
These are thebasic requirements and the necessary documentsthat you'll need for an Illinois title loan.
However, guaranteed approval will still depend on the credit information at the discretion of the lending company.
- A clear title to the automobile showing only your name (It will serve as security for your car title loan.)
- The vehicle (The title loan lenders must first inspect the car to determine its worth.)
- Images of the vehicle
- A document proves both employment and income. You can still locate a lender offering title loans even if you are unemployed.
- An ID issued by the government
- A statement of Illinois residency
- Details about a bank account (not always required, depending on the lender)
- Evidence of current vehicle registration and insurance
Title loan companies still protect consumers with a guaranteed offer.
For an online application, you'll need to provide the necessary personal info, mobile number, and other required account information.
When Do I Have to Repay a Title Loan in Illinois?
When it comes to repayment, many customers are pleasantly surprised by how long it takes until they have to make their first payment.
You would assume that title loans in Chicago, IL, like a payday loan or cash advance, would require immediate total payback, but that isn't the case.
Before putting in their first payment, typically required within 10 BUSINESS DAYS of receiving approval for title loans in Illinois, most borrowers can give up to 60 days.
How Can I Get Cash With Online Title Loans in Illinois?
Thanks to current technological developments and internet access, obtaining an online title loan has never been more straightforward.
Once you apply online, you get INSTANT APPROVAL using your personal computer!
To qualify for title loans in Illinois and apply online for an installment loan, you only need to provide some basic information, including your car title, income documentation, and ID, to the title loan company.
Accepting free online applications whenever convenient for you makes getting money simple through a vehicle title loan.
They can begin processing your credit application and completing the loan submission as soon as you submit your information.
Then, you can get your cash through a direct deposit.
Here are the commonly asked questions when getting a title loan in Illinois.
Who is Auto Title Lenders?
These are the lenders who typically provide other high-risk loans like secured loans for anticipating tax refunds.
These lenders cater to borrowers who require money quickly and don't have access to alternative funding sources like bank loans, credit cards, or family members who can advance them the money they need.
To issue a short-term loan in Illinois, title lending companies need a license.
Here you can find a comprehensive list of CILA licenses for consumer installments.
Why Should I Be Careful With an Auto Title Loan?
Your car's title serves as collateral for the vehicle title loan that title lenders provide you.
If you depend on your car for a living, you must be sure that losing your vehicle won't jeopardize your ability to keep your work.
These lenders tack on extra fees and hefty interest rates for each credit they make.
These loan proceeds may have reasonable monthly payments for a while, but at the loan's end, a balloon payment that may be far more than the borrower can afford must be made in full.
Even if you require money immediately, make sure to account for the costs, the high-interest rate, and the potential loss of your car.
What if I Can't Pay What You Owe Within the Proper Time?
The business has the right—and typically does—to repossess your vehicle.
ADDITIONAL FEES will start to accrue once your automobile is repossessed, and you won't receive your car back until you've paid all your payments by the due date.
How Do I Get Out of a Title Loan?
There are no simple ways to avoid paying back the money you owe because you have pledged to do so when you borrow money from a title lending firm.
To prevent additional costs, pay off the credit as soon as possible.
Otherwise, you could need to borrow even more cash from another person to get your automobile back.
Does a Title Loan Affect My Credit Scores?
A title loan WON'T often impact your credit scores. Both positive and negative effects may result from that.
To begin with, when you apply, the majority of title lending firms don't verify your credit. But, having a bad credit score can still affect how much cash loan they will offer you.
Because they don't require it, some lending companies will still do background checks on their own accord. Good and bad credit score standings will still affect your online application.
A hard inquiry typically lowers your credit score by five points or fewer.
How Can I Get a Title Loan if I Was in the Military?
The Military Lending Act safeguards you and your dependents if you are a military member.
The law sets a 36 percent cap on the annual percentage rate (APR) for various credit products, including credit cards and Illinois title loans.
Additionally, the law requires companies to advise you of your rights and the cost of the credit.
The military also provides financial assistance and assistance with money management.
Discuss your choices with a Personal Financial Manager (PFM) if you have financial problems.
- Do you require an advance on your income or more time to pay your bills?
- Do you want to discuss money management with a licensed credit counselor?
- Do you desire assistance from a military relief organization?
Ready to Take Out an Illinois Title Loan Today?
You may consider some specialist options if you have been in the military. A select few companies provide members of the military forces extra preferential rates.
Military members are also shielded from a few issues with Illinois Title Loans.
Auto money title loans do not affect your credit score.
If you default on Illinois title loans or experience other repayment issues, your bad credit score won't worsen. It's the risk of losing your car that will be your worry.
But, paying your bills on time won't help your credit score either.