You’re a resident of the Yellowhammer State and you have a financial emergency. Well, if you have a vehicle in your name and a lien-free title, it’s highly possible that you can get what’s called a title loan to see you through. Here’s what you should know about getting the best title loan in Alabama.
What is a Vehicle Title Loan?
This is a short-term loan – typically 30 days or less, although installment loans are sometimes available – that’s secured by your vehicle.
You do get to keep your vehicle during the life of the loan, as long as you’re current on payments. The lender will just hold onto your vehicle title until the loan is repaid. Note that if you do not make payments, your property will be at risk of being seized and sold.
What Size Loans are Available?
This varies by lender, but you generally can expect to get between 25-50 percent of your vehicle’s value, which is assessed based on make, model, age, mileage, and overall condition. Most loans are for between $100 and $10,000 and sometimes more.
What your loan won’t be based on is your credit score, although some title loan companies will check it. Because the loan is secured – collateral is involved – lender risk is diminished.
Am I Eligible?
As we say, you’ll need a vehicle and clear title, plus proof (pay stubs, bank statements, etc.) that your income is sufficient for loan repayment. You’ll also need a government-issued photo ID.
Other requirements vary by lender and the state in which it’s based, but can include items such as proof of vehicle insurance and professional or personal references.
You will also need to supply recent photos of the car – inside and out – including a clear shot of the odometer.
How Long is the Process?
Again, this varies, but it’s common to apply online and be approved the same day. Funds are often available the next business day and may usually be deposited directly into your bank account.
Vehicle Title Loans in Alabama
As for title loans in Alabama, you will need to provide proof of residency, in addition to basic documents such as vehicle title and vehicle title. You can usually apply for a loan online and the process is quite expedient.
It’s also possible in Alabama to find a company that will allow you to pay off your loan early, sans fees or penalties.
As for the kinds of vehicles accepted, Alabama lenders will generally consider hatchbacks as well as classic, luxury, and sports cars. Trucks, vans, and motorcycles may also qualify, depending on their value and condition.
What if My Vehicle Isn’t Fully Paid Off?
In Alabama, you may still qualify, but approval is less likely. If you are approved, the loan amount will be less than a person with a paid-off vehicle may be able to get.
What About Laws in Alabama?
Title loan companies in Alabama are covered under the Alabama Pawnshop Act, which means they must operate in accordance with laws set forth in the Act. For example, they are required to detail in writing monthly payments and any associated fees. Some rules also pertain to borrowers as well. For instance, they must declare that the vehicle they wish to use as collateral is not stolen.
What Kind of Proof of Income is Needed in Alabama?
In addition to paycheck stubs and bank statements, proof of worker’s compensation, disability, and Social Security income are also acceptable.
How are Loan Funds Available?
If approved, you can usually get funds via electronic deposit, a check sent overnight in the mail, and in some cases, MoneyGram.
So, shop around for the best title loan in Alabama. You should be able to find a lender that suits all your needs.