Car title loans can be a lifesaver for borrowers in Florida who can’t qualify for a traditional loan offer. They offer a way to borrow more than $1,000 without much of a credit check and you can be approved for up to $15,000 in less than one business day. However, before you sign off on a loan, knowing how much you’ll pay in interest charges and other fees with a car title loan is crucial.
The main drawback of any title loan in Florida revolves around the interest rates. While each company has different rates and terms that they assess for each customer, they must follow all applicable state regulations. For title loans in Florida, these laws come from the Florida Title Loan Act. These laws state that a lender can impose an interest rate of 30% APR for loans up to $2,000. The APR is capped at 24% for amounts between $2,000 and $3,000 and lowered to 18% for over $3,000. Keep in mind that not all title loan companies in Florida follow these regulations and it’s important to ensure your lender is licensed and registered as a title loan company within the state.
As of 2024, new proposed regulations are working their way through the State House and Senate that would further restrict title loan interest for higher loan amounts. These new laws would limit title loan interest rates to 36% for all loans under $10,000, and the rates for loans above that amount would be even lower.
The following fees apply to title loans in Florida
-Loan Processing Fee. This amount typically equals 25% of the borrowed amount, but it must be at least $55, not over $100. Your loan processing fee is often negotiable, and it can be bundled into your total repayment.
-Loan Documentation Fee. Similar to the loan processing fee, this amount differs from most lenders and is often equal to .5% of the borrowed amount, but not less than $3.50 and not greater than $10.
-Late Fee. A late fee may not exceed 5% of the payment amount past due. While you used to be hit with a late fee immediately, the most recent Florida Statutes give you a grace period of 15 days until your lender charges you a late fee.
Repossession Fees and Vehicle Storage Charges. If your vehicle is repossessed, you will be charged a tow and daily vehicle storage fees. You typically have at least 30 days to get your vehicle back after a repossession, after which your car or truck can be sold at auction. Any amount left over after your initial loan amount has been settled will be sent back to you within 14 business days.
Interest Rates And APR For A Florida Title Loan
For example, if you take out a $1,000 Florida title loan, you must pay back the original principal plus fees and interest, which equals 25 percent or $125.00 in processing fees. The total amount due would be $1,125 for a typical title pawn or 24 hour title loan.
If you get a $5,000 title loan, you’ll pay back around $1,250 in the first month. This includes the principal amount plus additional fees and interest charges, making your total repayment amount more than what you were initially given. If you do not repay your loan on time, your lender could report late payment charges to credit agencies, damaging your credit score.
Late payment fees in Florida are usually very high, so it’s best to try to avoid them by making regular payments instead of waiting until the end of the month, when all outstanding debts are due at once.
Other Rates And Fees To Expect With A Title Loan In Florida
In some situations, you would see a Documentary Stamp Tax assessed by the lender. This is not always common; you can sometimes bundle this tax and other fees with your total amount borrowed. The tax is a state fee for a large purchase, such as a car or boat.
You will also see fees for document preparation and mileage reimbursement for lenders who require you to drive to their office in person. While Florida Title Loans does not offer title loans directly within Florida, we understand the current regulations regarding interest rates and repayment terms. Call us at 888-986-8505 to see how much you can expect to pay with a title loan in Florida!