How do title loans work in Ohio?

I was thinking of getting a car title loan, but I'm not sure how they work. Can you explain it to me? I live in Ohio, if that changes anything.

Eric Schad · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
In 2019, the
government’s Short-Term Loan Act made title loans—signing over the title of your vehicle for a small amount of cash—illegal throughout the state to limit the predatory lending practices of title loan businesses. 
Many of these businesses had been charging as high as 600% annually. As a result, title loans are no longer an option for Ohio residents.
You still have other options to get quick cash. Here are a couple:
  • Get a one-year unsecured loan. This means you can get a short-term loan without needing a security deposit. The Short-Term Loan Act allows you to get a loan of this type for up to $1,000 with an interest rate that’s capped at 28%. However, this rate is far higher than some of its alternatives, assuming you have decent credit.
  • Search local banks or credit unions for unsecured loans. This is probably your best bet—if you’re approved, you can get a one-year loan for $1,000 that probably won’t have an interest rate higher than 15%. That will save you $75 over the course of the year.
  • See if you qualify for a cash-out
    car loan
    refinancing. This usually puts your interest rate in the single digits, saving you even more money on the loan.
Be sure that you have insurance coverage on your car as well since you might need to provide proof of insurance as part of using your title to get the loan. You need the state minimum anyway to avoid potential fines or penalties.
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