Do car title loans affect your credit?

I have a car title loan right now that I have been struggling to pay. Luckily, rather than repossess the car, my lender allowed me to refinance and extend the loan term. But I’m scared it’s hurting my credit. Do car title loans affect your credit?

Car title loans can be challenging to pay off, and no one wants to have their vehicle repossessed, so you are fortunate the lender allowed you to refinance and extend the term. The good news is that car title loans rarely affect your credit score.
A title loan lender typically does not report loan progress to the credit bureaus or sell your debt to a collection agency. This is because the loan is secured using your vehicle, and they can repossess it if you do not meet their terms.
By not reporting loan progress or offloading the debt, your credit score is left out of the equation and would only be affected if you default and the vehicle cannot cover the debt. At that point, it is reported.
To help make paying back the loan manageable, you can save money on your car insurance by downloading the Jerry app.
In less than 45 seconds, Jerry collects all of your information from your existing insurer. Choose from competitive quotes from up to 50 top insurance companies and Jerry takes care of the rest—securing your new policy and helping you cancel your old one. The average Jerry user saves $879 a year on car insurance.
Jack Walsh
Answered on Nov 08, 2021

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