Throughout the state of Florida, borrowers will find that online title loans are generally legal, but there are some limits and caps on interest rates and loan offers. There’s also not really a limit placed on how much consumers can borrow, but the state does adhere to strict loan regulations designed to protect borrowers from excessive borrowing and high fees. These regulations also prevent lenders from giving consumers more money than they can handle. Title loan companies are regulated statewide by The Florida Title Loan Act (Chapter 537).
Title Loan Regulations In Florida
Borrowers who wish to get a Florida title loan must have a current and valid state-issued driver’s license, be over the age of 18, and own an automobile titled in their name. Many pink lenders also have restrictions on things like the make, model, and mileage on the vehicle and while it’s not a Florida requirement, applicants are usually asked for proof of their ability to pay off the loan. This includes proof of income, like a pay stub or a bank statement. In terms of interest rates, the 30% cap applies to the first $2,000 of the loan, 20% for any amount between $2,000 and $3,000, and 18% for any amount over $3,000.
The maximum term on these pink slip loans is 30 days, but borrowers have an unlimited amount of extensions available to them every 30 days. To make the numbers a little easier to understand, let’s break down what a small loan for, say, $1,000 is going to look like for the borrower. If they extend the loan to cover a period of one year, then they’ll be required to pay back $1,000 plus $300 at the end of the term. If, however, they pay off the loan in one month, they’ll pay $1,000 plus approximately $25.
Once again, there are strict rules in place within the state of Florida to ensure that borrowers are protected from unfair lending practices. Pink slip lenders aren’t allowed to sell or even require insurance with a title loan, and they can’t do things like advertising “interest-free” loans or “no finance charges”. They’re also banned from charging prepayment penalties, refusing partial payments, or lending to anyone who’s under the influence of drugs or alcohol.
What happens if I can’t pay back a title loan on the due date?
If a borrower cannot pay back his or her loan, a licensed lender can repossess and sell their car to pay off their balance, but they’re required to give the borrower ten days’ notice before the sale. This gives the borrower one final opportunity to settle and pay off the full amount due before losing their car for good if the lender permits this which, in most cases, they will. Also, the lender is only allowed to use the funds retrieved from the sale to pay off what the borrower owes and any associated fees attached to the repossession and sale. If there’s a remaining balance, this must go back to the borrower within thirty days of the sale and if they have to go to court to pick up the balance, the lender is required to cover those legal fees.
Borrowers will want to make sure they ask upfront what a title loan lender’s policies are on repossession and sale procedures and whether or not they can get their car back before it’s sold. Once again, this is generally something that lenders will allow, but this stipulation falls under Chapter 516 which doesn’t have as many protections as Chapter 537. Lenders are required to provide written statements on amounts borrowed and interest rates, but repossession procedures, sales procedures, and what lenders can charge for these are not as clear or specific.
How Many Title Loans Can I Have At One Time in Florida
It’s important to consider the number of times you can refinance an online title loan in Florida. The reasons why this is important are obvious. One wouldn’t want to plan their immediate financial future around bad lending advice. Some states allow car title loans to be refinanced quite a few times. Other states like Georgia and Mississippi only allow it to occur three times. This will play a significant part in getting one’s budget set up for the next few weeks after a payday or title loan online is taken out.
Remember that defaulting on a title loan in Florida comes with huge consequences of an increase in finance charges and late fees. The fallout from default on a car title loan is even worse. You will still deal with the huge fees and interest rates. But most title loan lenders in Florida can repossess your vehicle after a few weeks of default. Based on this info, it’s best to find a local company for your budget and future situation.
Check If Your Title Loan Lender Is Licensed In The State Of Florida
Companies that give out no inspection title loans in Florida know the regulations that cover secured loans. The first step to take before you sign a contract or enter into a lending agreement is to make sure that the company is licensed in the State. When you work with a state-licensed title loan company in Florida you will be protected by the state regulations and requirements for lenders. Check with State Attorney General to see if you’re working with a licensed lender in FL.
Filing a complaint against a car title loan lender in Florida
Finally, if a borrower wishes to file a complaint about their pink slip servicing company, they can do this by contacting the Florida Office of Financial Regulation online: https://www.flofr.com/, or by calling 850-487-9687. Additionally, they can file a complaint with the Attorney General’s Office online or by calling 1-866-9-NO-SCAM.