Can you use your car as collateral for a loan?
I’m having trouble paying for my student loans and was wondering if it is possible to use a car as collateral for a loan?
Will Baldwin · Answered on Jan 12, 2022
Reviewed by Shannon Martin, Licensed Insurance Agent.
I’m sorry to hear that you’re in a tough financial situation. You can use your car as collateral for a loan. This is often called a car title loan, and it’s important to know it’s considered illegal in some states because it poses a high risk to borrowers.
If you default, the bank or lender can repossess your vehicle. If you’re comfortable with this risk, some lenders will allow you to use your vehicle.
If your state offers car title loans, shop around at multiple potential lenders to see if you can find a cheaper rate and reduce those payments. If car title loans aren’t an option, consider looking into personal loans or credit cards to tide you over until things get easier.
You can also free up some money by reducing your car insurance premium. Try using the number-one-rated car insurance app, Jerry, to find the best deals. Jerry compares personalized quotes from more than 50 top providers, including Nationwide and Travelers, and delivers the best deals to your phone in minutes for free. The average Jerry user saves $879 a year on car insurance.
View full answer
WHY YOU CAN TRUST JERRY
Jerry partners with more than 50 insurance companies, but our content is independently researched, written, and fact-checked by our team of editors and agents. We aren’t paid for reviews or other content.
Browse More Content
Insurance in Your State
What Others Are Asking
How do you program a BMW Z4 key?
How do I program my BMW Z4 key at home? I dropped my last one in the parking lot and it was run over.
Jan 12, 2022
Is there a calculator to show how much interest will I pay on my car loan?
Is there a way to know how much interest I’ll pay on my car loan, or is there a calculator that I can use? I want to know how much my loan will cost me so that I know if I should refinance it or not.
Jan 12, 2022
How do use your car as collateral for a loan?
I have some debt and am thinking about using my car as collateral for a loan. How do I do it?
Jan 12, 2022
Read Advice From Car Experts At Jerry
Townhouse vs Apartment: Which is Best?
Apartments are usually rented, single-story units in a complex while townhouses are usually owned, have more space, and offer more privacy.
2017 Subaru Forester Gas Tank Size
The 2017 Subaru Forester has a gas tank size of 15.9 gallons on all trim levels.