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How Does Pawning a Car Work

Imagine you want money and you're not sure where it's going to come from. If you have a car, you could have your solution. A car pawn, or a car title loan, is a quick and efficient way to get money when you need it.

A car pawn and getting a car title loan are not the same thing, although there are some similarities. It's important to be aware of them so when you get down to it, you're not surprised either way.

Differences Between Pawning and Online Title Loans

Car title loans involve using your car's title as collateral to get a loan. You keep driving your car for the duration of the loan and get a secured loan in the process. This includes getting your money faster and getting lower interest rates. It also means you can qualify even if you have bad credit. You can get a couple of years to repay the loan, as well, so the payments are affordable. The lender, meanwhile, hangs onto your lender while you pay the loan off.

With a Florida car pawn, you need to find pawn shops that will accept your car. You also need to find out if your car is eligible, since if your car is too old or has too many miles, it might not make the lender money. There's also another difference: some pawn shops require your car in addition to your car's title.

Should You Pawn Your Car?

If you rely on your car to get to places, like work or school or the hospital, you need to be very careful about pawning it. Some pawn shops have very high rates and if they hold onto your car, you won't be able to drive it. If you have a second car, it could be an option for you, but you still want to make sure you're careful. When you pawn something, if you don't make the payments or don't come back for it, the lender assumes the item pawned. That means some pawn shop owners set high rates so it's more difficult to repay. Also, you'll lose anything you did pay back toward the loan.

There are several advantages to pawning your car, including:

  • Aren't many requirements to apply
  • May be able to keep your vehicle
  • Receiving your money very quickly
  • High acceptance rates for bad credit

As with most things in life, there are also disadvantages. For instance:

  • The interest rates can be extraordinarily high
  • You may not be able to continue driving your car
  • You might not receive the full value of your car
  • You usually have less than 6 months to repay the loan

If you need money quickly, pawning your vehicle could be an option, but it could be to your advantage to consider online title loans. The terms are more likely to be in your favor and there are more options.

How to Pawn Your Car

If you've decided to pawn your car, you should start by finding a pawn shop that accepts cars and accepts one with your make and model. A Google search, followed by phone calls, is best for this. Obviously, there's some leg work involved. ask questions to make sure you know what you're getting into, even before you go in.

Usually, for a car pawn you'll need the vehicle, the car's title, a valid, government-issued ID, proof of insurance and a copy of the car key. They need to be able to get into the car, even if you're able to hold onto it.

From there, you're pretty much done. If the lender decides to accept your vehicle, you'll get your money and your good to go.

In the right circumstances, a Florida car pawn can be a good option. It's fast and you can get money for your vehicle. However, it's important to be aware of the terms and consider all of your options.

We offer car title loans in Florida, as well as the following metro areas: