Title Loans For People on Disability: What You Need to Know

With title loans serviced by LoanMart, you can qualify for a loan on disability as long as you have a source of income such as disability payments from the Social Security Administration.¹

Understanding Disability Loans

If you have a disability, the challenges that life throws at you at times can be daunting. When being a bit short on cash is one of these challenges, qualifying for a loan that accepts disability income during the underwriting process can be one of them.

There are different types of loans that accept disability income during the underwriting process. These loan options can include the following disability loan types:

• Secured disability loans: secured disability loans are loan options that require that the borrower can provide some type of collateral that secures the repayment of the loan. Common forms of collateral include vehicles, real estate, or other valuable property.
• Unsecured disability loans: unsecured disability loans don’t require collateral. They are therefore primarily based on the applicant’s creditworthiness and income, including the disability income and any additional income sources.

• Credit profile: if you are looking for a disability loan with bad credit, a secured loan may offer better chances to get approved.
• Collateral ownership: if you don’t own a valuable asset that can be used as collateral, or if the asset is still being financed, an unsecured loan may be a better option or the only option.
• Required disability loan amount: if you are looking for a high maximum loan amount and own a highly valuable asset, a secured loan may offer higher approval amounts than an unsecured one.

How Disability Income Impacts Loan Qualification

While searching for a loan that accepts disability, you may be wondering how receiving income through disability benefits impacts your ability to qualify for a loan. Assuming that you’ve found a lender that accepts disability benefits as an income source, the following considerations may apply to the application process:

• Documentation requirements: most lenders that accept disability income as valid income to support loan payments will require some form of documentation to verify the income and to ensure it is stable, recurring income. Examples of the documents that some lenders accept include recent benefit or award letters or recent bank statements that show the incoming amounts and consistency.
• Potential tax advantage: if an applicant receives disability benefits that are exempt from income tax, such as a portion of SSDI benefits or VA benefits, some lenders may multiply the income by a factor that’s intended to increase the income to an equivalent amount if the income was taxable. This calculation, also known as “grossing up” the income, can improve loan eligibility for people who are receiving benefits.
• Long-term vs short-term benefits: if an applicant receives long-term or permanent disability checks, that’s more likely to make for a smooth loan application and underwriting process. If the applicant is only on short-term disability, lenders might require proof of other income sources if the short-term disability payments are expected to end soon.

What to Consider Before Applying While on Disability

If you are considering to submit an application for a disability loan online or at a loan store near you, it may be worthwhile to see if you can make up your current cash shortfall without taking out a loan at all. Some of these options can include:

• Emergency Advance Payments directly from the Social Security Administration (SSA).
• Other government programs specifically related to your cash need, for example the home repair assistance program if you house or apartment needs a facelift or major repair.
• Worker’s compensation benefits may be accessible to you if your disability was caused by a work-related illness or injury. In order to qualify for worker’s compensation, be sure to follow the specific requirements that apply in your state.
• Borrowing from a close friend or family can also be an option to consider. While involving money matters in close friendships or with family members has the potential to put some strain on the relationship, that downside can be mitigated when all parties are on the same page in regards to the amount borrowed and the anticipated repayment.

Besides considering the above alternatives, it’s also a good idea to take an honest look at your personal budget. While lenders typically assess a borrower’s ability to make loan payments by verifying the income and using criteria such as a maximum payment-to-income ratio, nobody knows your budget better than you do! If your budget doesn’t have room for taking on a loan payment, getting a loan that accepts disability income is likely not a good idea.

How to Qualify For a Title Loan Serviced by LoanMart While On Disability

If you are looking for a disability loan with bad credit, applying for an auto title loan serviced by LoanMart can be an option to consider. With title loans serviced by LoanMart, there are no additional requirements besides the usual title loan requirements that apply to all applicants.¹ One of the key requirements of course is residing in a state that is serviced by LoanMart. Several of the states that are reported to have high rates of disability recipients, such as Alabama, Arkansas, Mississippi and Kentucky, have title loans serviced by LoanMart available. When completing your loan application, simply provide your disability income information when prompted, and you’re on your way to completing the application process for the cash you need!¹

Final Thoughts On Loans While on Disability Benefits

Several loan options are available for people whose primary or secondary source of income are disability benefits. Before taking out a loan, it’s a good idea to consider alternatives such as government assistance programs.  If you are looking for disability loans with bad credit, consider applying for an auto title loan serviced by LoanMart!¹