Title Loans New Mexico FAQ
What Is A Title Loan?
A title loan is a type of secured, short-term loan that uses your car’s title as collateral for the money you borrow. Title loans let borrowers keep their cars while they repay the loan while the lender holds onto the title paperwork. Titles are returned when the borrower has paid down the loan principal plus any interest or fees in full.
It is useful to note that title loans are only designed to be short term. They will often last around one month with the potential to roll over a limited number of times. Since title loans are designed to meet immediate financial needs, it is not advisable to use one as the sole resource for a long term financial plan.
How Much Can I Borrow?
What you can get for a title loan is going to vary greatly depending upon what lender you work with and what vehicle is used to secure the loan. In New Mexico, there is a cap on title loans that states that borrowers can borrow no more than $2,500 at a time on a loan, and a borrower cannot have more than one loan out against the same vehicle. Lenders must follow the Small Loan Companies regulations set down by the state, and thus borrowers can expect a loan for either around half the value of their vehicle or the $2,500 cap, whichever is lower.
What Will This Cost?
Title loans are generally a pretty affordable loan due to how they are structured. The interest rate you see on paper will likely be higher than what you see with a bank loan, but title loans last far less time than long-term loans. That means that, while the rate might be higher borrowers are paying less interest overall, so the dollar amount will be lower. The exact interest rate associated with your loan will depend on your specific lender. Many loans also come with nominal servicing fees, which will not be applied as payment to the loan principal or interest.
What Happens If I Can’t Repay?
If you can’t repay your title loan in a timely fashion, the first thing you want to do is call your lender. They may be able to work with you to create a reasonable repayment plan and roll the terms of your loan over for another loan period. If you and your lender are unable to reach an agreement about repayment and your loan goes into default, the lender may have the right to repossess your vehicle and sell it to recoup the cost of the loan.
Do I Have To Give Up My Car?
No. With a New Mexico car title loan, you don’t need to give up your vehicle while you borrow. Instead, your car’s title paperwork will serve as collateral for the amount you borrow. You keep the keys throughout the life of the loan, and there are no restrictions on vehicle usage. Once you have paid down your loan plus all interest and fees, the title goes right back to you.
How Do I Get A Title Loan?
Many title loans are available online, and using our fast and free web form we can set you up with a title loan that is customized to your borrowing needs. All you have to do is provide us with some basic information about your vehicle and you will get a free, instant estimate letting you know how much your loan could be worth. From there a member of our team will work with you one on one to find and customize a New Mexico title loan specifically to fit your borrowing needs.