Recently, my water heater broke, and I desperately need some extra money. Even though my car is financed, I want to apply for a title loan. I still owe about $1,000 even though it’s almost completely paid off. Even though it’s still financed, can I still get a title loan?
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Can you use a financed car as collateral for a loan?
Is my car acceptable as loan collateral? Of course, your car is acceptable as loan collateral. Secured loans call for a valuable the lender can seize if you don’t pay back the loan.
Does your car have to be paid off to use as collateral?
You must own the car outright in order to use it as collateral. The equity in a car is the amount left over after all debts have been paid. You have $10,000 of equity, for instance, if your car is worth $20,000 but you still owe $10,000 on your loan.
Can you use a leased car as collateral for a loan?
Because you are still making payments on a leased car, you may not actually own it. In other words, your lender has the controlling interest. So you can’t use the car as collateral because you don’t actually own it.
Can you get a title loan with a financed car in Georgia?
Although there are no legal restrictions on getting a title loan, some lenders will only offer one if you completely own the vehicle. You are in a better position to obtain a title loan than if your loan was in default because you have positive equity in your car, or your car is worth more than the outstanding balance.