Title Loan Regulations In Florida
Throughout 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 no limit on how much consumers can borrow. Still, the state does adhere to strict lending regulations to protect borrowers from excessive borrowing and high fees, and most importantly, you have protections if your vehicle is ever in danger of being repossessed. Title loan companies are regulated statewide by The Florida Title Loan Act (Chapter 537).
Borrowers wishing to get a Florida title loan must have a current and valid state-issued driver’s license, be over 18, and own a vehicle titled in their name. There are income requirements for a title loan in Florida, and you generally need to make $2,500 or more to qualify for a title loan of $3,000 or more. Some pink slip lenders have limits on the types of vehicles that can be used as collateral, but generally, you can cash out equity from a car, truck, or motorcycle. Sometimes, you can use a boat, RV, or commercial truck as collateral for a title loan in Florida, but loan amounts will often be lower. While it’s not a Florida requirement, applicants are usually asked to prove their ability to repay the loan.
The maximum term on these pink slip loans is 30 days, but borrowers have unlimited extensions available every 30 days. Strict rules are in place within Florida to protect borrowers 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 someone who can’t afford the monthly payments.
What happens if I can’t pay a title loan on the due date?
If a borrower cannot repay their title loan, a licensed lender in Florida can repossess and sell the car to pay off their balance, but they must give the borrower ten days’ notice before the sale. This provides the borrower with one final opportunity to pay off the due amount before losing their car for good. Even if you’re only in danger of falling behind but have yet to miss a payment, we always recommend contacting your lender and working out alternate payment arrangements. At this point, it’s much easier to negotiate to lower your monthly payment or reduce your interest rate than if you had already fallen behind.
Also, the lender can only 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 vehicle’s sale, and if they have to go to court to pick up the balance, the lender must cover those legal fees.
Borrowers will want to 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, lenders generally allow this, but this stipulation falls under Chapter 516 of the Florida Statutes, which doesn’t have as many protections as Chapter 537. Lenders must provide written statements on borrowed amounts and interest rates, but repossession procedures, sales procedures, and what lenders can charge for are not as straightforward.
How Many Title Loans Can I Have At One Time in Florida
Have you ever thought about how many times you can refinance an online title loan in Florida? The reasons why this is important are apparent for anyone who’s looking to reduce the interest rate on a title loan with an APR of 50% or more. One wouldn’t want to plan one’s immediate financial future around bad lending advice. Some states allow car title loans to be refinanced quite a few times, while others like only allow it to occur three times. In Florida, you can refinance your title loan as often as your lender allows. Some companies will also buy out your title title loan, which means they’ll get you new lending terms on a title loan. Most importantly, you can avoid a possible repossession if a lender buys out your loan and get you new payoff terms.
Remember that defaulting on a title loan in Florida leads to increased finance charges and late fees. The fallout from default on a car title loan is even worse. You will still deal with huge costs and interest rates each month that your loan goes unpaid. But most title loan lenders in Florida can repossess your vehicle after a few weeks of default. Besides dealing with the stress of repossession, you may also owe money to your lender if the car is sold at auction and it doesn’t cover the total loan costs. In this scenario, your debt will be unsecured, but a lender can still come after you in a civil case and threaten to garnish your wages for the unpaid amount.
Check If Your Title Loan Lender Is Licensed In The State Of Florida
Companies that offer no inspection title loans know the regulations that cover secured loans. There’s only so much they charge you regarding interest rates, fees, and other loan origination charges. However, some lenders aren’t licensed to provide title loans or any other short term loan in Florida. Contact the State Attorney General’s office to see if you’re working with a licensed lender in FL.
Some secured lenders operate entirely online, and others operate as tribal lenders. These companies claim to be exempt from lending regulations in Florida, and most aren’t registered or licensed as title loan companies in Florida. While you can sometimes get a lower interest rate with an unlicensed lender, you won’t have the regulatory protections if that company was a state licensed lender.
Filing a complaint against a car title loan lender in Florida
Finally, suppose a borrower wishes to file a complaint about their title loan company. Maybe they were charged too much in fees, or the lender repossessed their vehicle without giving enough notice. Other times, a lender may promote a title loan at a specific rate, only to increase the APR a few months into the lending term. In these cases, you can complain about a lender by contacting the Florida Office of Financial Regulation online 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.
