Car Title Loans Canada

What a title loan is, stated plainly

You pledge the vehicle you already own as security for a loan. The lender registers a lien and can repossess if you default.

The vehicle you use to get to work becomes the security for borrowing you needed because money was tight. That is the structure, and it is the reason this page is written the way it is.

Where it sits against the alternatives

At the same amounts, an unsecured personal loan is capped at 35% APR and puts no asset at risk. Title lending exists for people who cannot access that, and the price of access is the vehicle.

Before considering a title loan:

• An unsecured personal loan. Capped at 35% APR, with no asset at risk. Several lenders in our personal network approve below a 560 credit band
• A zero-interest advance. Available at small amounts from lenders in our personal network
• A payment plan with whoever you owe. No interest, no lien

What to establish before signing

1. The total repayment in dollars, not a rate or a payment
2. The repossession trigger. How many days late, and whether notice is required
3. Whether a deficiency balance survives repossession. In many cases selling the vehicle for less than the balance leaves you owing the difference and without the car
4. Whether the loan can be renewed, and what renewal costs
5. Provincial licensing. High-cost credit licensing applies in several provinces and the register is public

The specific risk

Repossession does not end the debt. If the vehicle sells for less than the outstanding balance, the shortfall is generally still owed. The realistic worst case is no vehicle, an ongoing balance and the credit damage.

That outcome is not rare, and it is the reason the alternatives above are worth genuine effort first.