Do Title Loans Affect Your Credit Score? | Advantage Finance LLC (2024)

FAQs

Do Title Loans Affect Your Credit Score? | Advantage Finance LLC? ›

Title loans do not affect your credit score because is required when you apply for a loan. The issuer of a title loan only uses your vehicle, such as a car or truck as collateral. Secure loans do not require a credit check.

Most of the time, title loans don't affect your credit. If the lender doesn't run a credit check, there will be no hard inquiry on your credit report. By the same token, your on-time payments won't help your credit either since the lender won't report them to credit bureaus.

Limited Company (Corporations)

Shareholders have limited liability, meaning they aren't liable for the company's debts. The company's ability to repay loans cannot affect your credit reports. However, lenders might request personal credit details from directors and owners before granting loans.

At TitleMax, we use the title to your car as your collateral in most states, rather than your credit history. So, when you give us your car title, we give you cash. For auto title loan or pawn services, a vehicle and the vehicle's title are required to be approved for a loan/pawn.

Hard inquiry on your credit: Due to the hard credit check, you will likely see a short-term drop in your credit score when you formally apply for the loan. Late or missed payments could lower your score: If your payment is late by 30 days or more, the lender will report it to the credit bureaus.

Car title loans are also known as title loans or pink slip loans. Car title loans are usually short-term with high interest rates. A lender might not require that you have good credit but they may ask you to prove you can pay the loan back and have a regular address.

Auto title loans use your vehicle as collateral on short-term loans with ultra-high interest rates and no credit check requirement. Secured personal loans typically have longer loan terms, lower rates and rely in part on your credit and income for loan approval.

TitleMax, a prominent lending company, experienced a data breach in February 2023, compromising personal information. TMX Finance, the parent company, disclosed the breach in March 2023. A class-action lawsuit was filed against TMX Finance, alleging negligence and delayed notification to consumers.

TitleMax® does run credit checks on all new applicants, but that may not disqualify you for a personal loan or title-secured loan/pawn. When you need money unexpectedly, it's a good idea to look for loans that offer flexibility for people with bad credit.

To ensure a timely payment, please visit your local TitleMax store on or before your due date. We accept cash, certified checks, money orders, bank card & Western Union Quick Collect.

Do loans mess up your credit score? ›

A personal loan will cause a slight hit to your credit score in the short term, but making on-time payments will bring it back up and can help improve your credit in the long run. A personal loan calculator can be a big help when it comes to determining the loan repayment term that's right for you.

Generally, the lower your credit score, the higher the annual percentage rate (APR). To get a reasonable interest rate, you may need around a credit score of 660 or higher. If you have a poor credit score (in the 300–500 range) you may be able to have a co-borrower help with getting you approved for a car loan.

For a score with a range between 300 and 850, a credit score of 700 or above is generally considered good. A score of 800 or above on the same range is considered to be excellent. Most consumers have credit scores that fall between 600 and 750. In 2023, the average FICO^® Score^☉ in the U.S. reached 715.

Short repayment terms: Car title loans are typically for 15 to 30 days, with some up to 60 days. It may be difficult to repay the loan and the financing fees in such a short period of time. If you don't pay it back, the loan will roll over with additional interest and fees.

A title loan is a short-term loan that requires an asset as collateral. Title loans usually do not take into consideration an applicant's credit history and can be approved very quickly. The most common type of title loan is a car title loan, where the car itself is the asset put up as collateral.

It is possible for a borrower to be on the loan but not on the title of a property. This can occur in situations where the borrower is acting as a non-occupant co-borrower to help a relative or friend qualify for a mortgage, but does not have any ownership in the property.

You need to be at least 18 years of age or older and be able to prove this by showing a government-issued ID. You must also have a car with a lien-free car title in your name and some source of regular income. The latter can be anything from a pension or disability, to a regular salary or unemployment benefits.