11 October 2017

Car Title Loan Laws As They Pertain to Each State

Car title loans are a means to which consumers who need cash can obtain it quickly, without a credit check, and without having to go through a bank. In fact, most car title lenders don't require you to have any credit at all, nor do you need to fill out the type of paperwork you would at a bank. Many people are even turned down by a bank.
If you're one of those is in a dire situation where you need cash quickly, here are some rules to be mindful of as they pertain to each state. Find the state you live in and determine if it fits your needs.
There are 16 states in the U.S. that allow car title lending with interest rates that have no limits. These states, unlike states with caps, can charge you triple digit interest rates, meaning you have to be very careful when taking out a title loan.
These states include Alabama, Georgia, Virginia, Tennessee, Mississippi, Louisiana, Arizona, Delaware, Idaho, Illinois, Missouri, South Dakota, Utah, Nevada, New Mexico, and Wisconsin.
There are eight states in the U.S. that authorize car title loans but there is a cap on the interest rates to where they cannot reach triple digits. These caps are designed to protect the consumer and monitor lenders. The states that have caps on interest rates include Florida, Kentucky, Iowa, Minnesota, Montana, Oregon, New Hampshire, and Vermont.
There are a select few states that are called "loophole states." These states operate with their own set of rules so it's important to examine the individual rules pertinent to each of them. These states include Kansas, Texas, California, and South Carolina.
In the state of Texas, title lenders operate under the umbrella of a Credit Services Organization. In the state of Kansas, title loans are allowed with open-ended lines of credit. In South Carolina there is a $600 cap APR and in California there is a $2,500 cap APR.
One thing you will want to keep in mind as you find your state: There are a lot of title lenders that operate "border locations." These locations are just across state lines and allow people who live in states where title lending is either illegal or there are restrictions to come and get loans legally. There are also lenders who offer title loans online through virtual offices, giving more options for those who need them.
If you see a lender that is not operating within the laws of your state or is operating without a license, you need to call your state attorney general office and report them so they can't take advantage of you or anyone else by not following the law. The laws in this industry are designed for your protection as a consumer.