By Marcela De Vivo • March 6, 2022
Your “credit” refers to your ability to borrow money under the condition that you will repay it with interest in the future. Having good credit is important. Your credit score can impact your ability to buy a house, finance a new car, or secure student loans to get a higher education. A solid credit score can also make it easier to pass background checks conducted by potential employers or landlords.
There’s no doubt that credit plays a huge role in your life. Before making any financial decision, it’s important to consider how your choice will impact your credit. For this reason, if you are thinking about taking out a title loan, you need to learn how this decision could affect your credit.
Do title loans build your credit? Do title loans hurt your credit? Here’s what you need to know:
The first question on your mind might be, “Can I get a title loan with bad credit?” You typically need to meet a minimum score requirement to qualify for a traditional personal loan. However, title loans are not traditional personal loans, so the eligibility requirements are not the same.
You will need to consent to a credit check as part of the title loan application process. The lender will evaluate your credit when determining your eligibility. However, your credit isn’t the only factor that is used to determine if you are eligible for a title loan.
Remember, a title loan is secured by the title to your vehicle. Because of this, the title loan company will consider your vehicle’s value when determining your eligibility for a title loan. Other factors, including your ability to repay the loan, can also impact your eligibility.
Because your credit isn’t the sole factor that determines your eligibility, you may still qualify for a title loan even if your credit isn’t perfect. In fact, many people who don’t qualify for traditional personal loans due to their credit can still qualify for title loans.
Title loan companies accept most credit types, so don’t let a less-than-perfect credit score or your fear of a credit check stop you from getting the money you need.
A credit bureau, which is also known as a credit reporting agency, is a company that is responsible for collecting consumers’ credit information. Lenders can pay to access this information when determining whether a specific applicant is eligible for a loan. The three main credit bureaus are TransUnion, Equifax, and Experian.
If you’re thinking about
taking out a title loan, you may be wondering whether your lender will report your loan information to the credit bureaus. Your title loan company will likely report your information, which means the payment history on your title loan will likely appear on your credit report. Not only will it appear on your credit report, but it could also impact your credit.
To understand how a title loan can impact your credit, it’s important to learn how credit scores are calculated. A number of factors can impact your credit score, including:
Each of these factors can impact your overall credit score.
At this point, you should have a basic understanding of how your credit score is calculated. Now it’s time to learn how a title loan can impact each of the factors that are used to calculate your credit score.
The bottom line is that a title loan will impact your credit. Taking out a title loan could cause a slight drop in your score, but should be temporary. In the long run, your actions will determine whether your loan has a positive or negative impact on your credit.
If you want to build your credit, it’s crucial to make consistent, on-time payments on your title loan. Making a late payment or missing a payment altogether could negatively impact your score. To protect your credit, do not make the mistake of borrowing more than you can afford to repay.
You should also make sure you understand when your payments are due and how to make payments. This way, you won’t accidentally miss a payment or make a late payment due to a simple misunderstanding.
USA Patriot Act Disclosure: Important information about procedures for opening a new account
To help the government fight the funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify, and record information that identifies each person who opens an account. What this means for you: When you apply for a loan, we will ask for your name, address, date of birth, and other information that will allow us to identify you. We may also ask to see your driver's license or other identifying documents.
Loans may be made by one of several lenders, including: Wilshire Commercial Capital L.L.C. dba 1 (800) Car-Title and Wilshire Consumer Credit, a licensed lender in certain states. Loans not available in all states. In California, loans are made pursuant to a Department of Business Oversight California Finance Lenders License. See State Disclosures for additional information.
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Wilshire Commercial Capital, LLC dba 1 (800) Car-Title and Wilshire Consumer Credit is located at 4727 Wilshire Blvd, Suite 100, Los Angeles, CA 90010.
TO REPORT A PROBLEM OR COMPLAINT WITH THIS LENDER, YOU MAY WRITE OR CALL Tracy Bergiman, Director of Compliance, 4751 Wilshire Blvd. Suite 100, Los Angeles, CA 90010, 323-837-5775, tbergiman@westlakefinancial.com.
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(505) 476-4885 or visit the website: https://www.rld.nm.gov/financial-institutions/.
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