What Is a Vehicle Title Loan?
A vehicle title loan is a secured loan that uses your vehicle’s title as collateral. As Jason Fernando explains in his Investopedia article contribution, the lender holds a lien on the title until you repay the loan, while you keep using your vehicle. Title loans typically range from 25% to 50% of the vehicle’s value.
The 2020 COVID pandemic brought sudden income losses and unexpected bills for many households. Research by the Consumer Financial Protection Bureau (CFPB) found that about 2% of US consumers had taken out an auto title loan in the six months to June 2019, with use rising slightly in the year to June 2020, a period that included the start of the pandemic. For many families, a title loan offered a way to cover urgent costs during uncertain times.
How Title Loans Work in Texas
Title loan rules differ widely by state. In Texas, many title loans are arranged through a licensed Credit Access Business (CAB) with an independent third-party lender. Barco is a CAB licensed by the Texas Office of Consumer Credit Commissioner (OCCC). Barco does not lend money; it charges a fee to arrange the loan.
Vehicle and Title Requirements
To use your vehicle as collateral, you will need to provide the following documentation during your application:
- Your vehicle title, in your name.
- Details about your vehicle, such as make, model and mileage.
- A government-issued photo ID showing you are 18 or older.
- Proof of income and bank account details.
Barco verifies your ownership and title position during underwriting and will confirm whether your vehicle qualifies. Title loan amounts range from $300 to $10,000.
How the Title Loan Process Works
- Apply online: Start your application on the Barco website.
- Pre-qualify: A Barco representative contacts you to pre-qualify you and answer questions.
- Finalize at the branch: Visit our FM 1960 West branch, a short drive from Spring, to complete your loan.
- Receive your funds: Approved funds are deposited into your bank account.
Repaying Your Vehicle Title Loan
A single-payment title loan is repaid in one lump sum on the due date. An installment title loan spreads repayment over several scheduled payments. Under Texas rules, CAB loans cannot run longer than 180 days. Compare both on our loan options page.
What Happens If You Miss Payments
Missing a payment can lead to late fees, and refinancing instead of paying in full adds more charges. If you default, your vehicle may be repossessed in line with your agreement and Texas law. If you think you may miss a payment, contact Barco as early as possible.
Vehicle title loans in Spring, TX let you use your vehicle to cover short-term needs while you keep driving it. Know the requirements and plan your repayment before you apply. If you have questions about the process or want to apply for a loan, contact the Barco team today.