Buyer Beware: Watch Out for the Car Title Loan Scam
kw: car title loan scam
Meta: While they may be legal in some states, the car title loan scam can cost you thousands of dollars. Before you sign, rethink your decision.
It might not technically be a scam, but it might as well be. With car title loans, you use your vehicle title as collateral. You get an expensive, high-interest rate loan that has to be repaid in a short amount of time. Often, you are given less than a month to repay the loan, and the interest rate and fees can easily add up to 300 to 2,000 percent of the loan amount. While the car title loan scam is illegal in many states, there are still some that allow this process to exist.
The Danger of Car Title Loans
In 2012, …show more content…
They could hand out payday loans, title loans and other short-term lending products with only state laws regulating the process. The CFPB added an extra layer of regulation, but it still is not enough. The Center for Responsible Lending previously reported that 17 percent of title loan customers dealt with repossession fees, although the number that were actually repossessed is unknown.
The Car Title Loan Scam Today
While the car title loan scam has been outlawed in many areas, you can still legally get a title loan of some kind in 20 states. These states include Alabama, Arizona, California, Delaware, Georgia, Idaho, Illinois, Kansas, Louisiana, Mississippi, Missouri, Nevada, New Mexico, Ohio, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, and Wisconsin.
Some states like Montana had regulations that keep the APR from topping 36 percent. Montana recently voted against allowing title loans at all though. Because of abuses of title loans, an attempt was made to regulate title loans and limit the APR to 36 percent in Illinois, but this vote did not pass. To prevent abuses and predatory lending, 30 states have completely banned title loans and many of the other 20 have regulations of some form or
kw: car title loan scam
Meta: While they may be legal in some states, the car title loan scam can cost you thousands of dollars. Before you sign, rethink your decision.
It might not technically be a scam, but it might as well be. With car title loans, you use your vehicle title as collateral. You get an expensive, high-interest rate loan that has to be repaid in a short amount of time. Often, you are given less than a month to repay the loan, and the interest rate and fees can easily add up to 300 to 2,000 percent of the loan amount. While the car title loan scam is illegal in many states, there are still some that allow this process to exist.
The Danger of Car Title Loans
In 2012, …show more content…
They could hand out payday loans, title loans and other short-term lending products with only state laws regulating the process. The CFPB added an extra layer of regulation, but it still is not enough. The Center for Responsible Lending previously reported that 17 percent of title loan customers dealt with repossession fees, although the number that were actually repossessed is unknown.
The Car Title Loan Scam Today
While the car title loan scam has been outlawed in many areas, you can still legally get a title loan of some kind in 20 states. These states include Alabama, Arizona, California, Delaware, Georgia, Idaho, Illinois, Kansas, Louisiana, Mississippi, Missouri, Nevada, New Mexico, Ohio, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, and Wisconsin.
Some states like Montana had regulations that keep the APR from topping 36 percent. Montana recently voted against allowing title loans at all though. Because of abuses of title loans, an attempt was made to regulate title loans and limit the APR to 36 percent in Illinois, but this vote did not pass. To prevent abuses and predatory lending, 30 states have completely banned title loans and many of the other 20 have regulations of some form or