A registration loan is an unsecured loan that requires a government issued ID, a vehicle, proof of residence, proof of income, bank stubs, credit history and many more banking documents that assure they will receive repayment. A registration loan simply requires you to have your name on a vehicle registration. While this sounds good in theory, a registration loan is still an unsecured loan. In the state of Arizona, an unsecured loan does not have an interest rate cap.
A closer look at Registration Loans
Before going over how to get a registration loan, you should know what to expect. If there is documentation of the interest rate in your agreement, companies can charge you any interest rate. If there is no agreed upon interest rate, specifically, there was not a rate in the documentation, then the state of Arizona does cap the rate at 10%. Registration loans have found a loophole that allows them to charge which ever rate they see fit. Since they are not a payday loan, they do not follow the same lending guidelines. With a secured loan, such as a car title loan, there are guidelines set up by the Arizona Department of Financial Institution. These guidelines are in place to ensure all lending processes have some means of restriction so that the consumer does not get caught in a cycle of debt.
If you still decide to go forward with a registration loan, just keep in mind the consequences of not having successful repayment. With registration loans, if you do not follow through with correct repayment, the company can send your account into collections and eventually sue you in a civil court for the balance, and you may have your wages garnished and, though rare, they can also repossess your vehicle.
How to get a Registration Loan in Arizona
Registration loans are relevantly new, but are like any other unsecured loan. You will find that there are many lenders in Arizona that will want to work with you. Make a list of the closest few and begin your research and see that the lenders have tools for you to make the application process easy. You will find often, registration lenders only have storefronts, or are online only. Since registration lending is much newer, many registration lending businesses do not yet have the tools to streamline the application process. You will also find that registration lenders will require you to bring in your vehicle so that they can verify and assign the vehicle‘s value.
What other factors does a registration loan consider
A registration loan also requires a sort of credit check. Lenders will try to work with you, even if you have bad credit, but since registration loans are not regulated, there is no cap for interest rates. This means if the lender chooses to work with you, they can offer you inflated interest rates, and they don’t need to explain how they came up with that number. There is very little accountability when it comes to unsecured loan lending. The lenders will want to get you a loan, so they may remind you that you don’t need a clear title. Remember, they don’t require a clear title because they are not going to use the title as collateral. The lender isn’t using collateral because they are using an unsecured loan type. They secure the loans by attaching higher interest rates.
Safer alternatives to registration loans
The reason many people decide to go with nontraditional lenders is because they cannot get loans through traditional financial institutions. Banks and other loan alternatives will rely heavily on credit scores and credit history. If you have less than ideal credit, they may be less likely to take you on as a customer.
You can always find another form of nontraditional lending, but you should consider the differences of secured loans and unsecured loans. LoanMart offers secured loans by asking you to use your car title as collateral. By using the title as security, LoanMart has the ability to dispense greater funding, present longer repayment terms and conditions, and competitive interest rates1. If you are already looking to get a loan, why not choose a secured loan. We make it easy to get a car title loan, and you can get a car title loan with 3 easy steps:
- You give us a call at 1-877-787-4923, visit us at any of our participating stores, apply online on LoanMart’s website and even use your mobile device using our LoanMart Mobile App.
- You can get approved on your title loan in as little as one business day3.
- You will be paid with either a check, in person at a participating store, electronic money transfer or through participating MoneyGram stores1.
To get a secured car title loan with LoanMart, you will need the following:
- a car title to a qualifying car in your name
- a government-issued ID (driver’s license, state ID, etc.)
- proof of income (such as paystubs, invoices or bank account statements
- proof of residents (such as a recent utility bill)
You can fax, email or text us pictures of your documents to us, and our helpful agents are available to help you, wherever you are. Getting a title loan with LoanMart is simple. You can give us a call at 1-877-787-4923, visit us at any of our participating stores, apply online or use your mobile device to apply with LoanMart. When you are ready to apply, then you can begin the car title loan process and get a loan with the terms that work best for you1.