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  1. #1
    Join Date
    Dec 2015
    Posts
    1

    Default Can a Title Loan Lender Keep Your Title as Collateral for Another Loan

    My question involves collection proceedings in the State of: Tennessee.
    I have been paying on a title loan for over a year, I also have a signature loan with the same company. I make both payments on the 3rd of every month. When I made my payments this month I was informed that they are no longer doing title or signature loans, that they are only doing personal loans. So I have a remaining balance on the title loan of $375 and a $400 balance on the signature loan, and that next month when I pay the title off they will hold the title and use that as collateral for the other loan which originally was a signature loan. How can they legally keep my title I already pay extremely high interest and thought I was going to be getting my title back after paying extremely high interest for over a year on the title loan its like I'm being forced to use my title and car as collateral for another loan when that was not what I agreed to with the signature loan....

  2. #2
    Join Date
    Sep 2005
    Location
    Behind a Desk
    Posts
    98,846

    Default Re: Title Loans

    You will need to read your loan contracts to determine what they can and cannot do.

  3. #3
    Join Date
    Mar 2013
    Posts
    17,129

    Default Re: Can a Title Loan Lender Keep Your Title as Collateral for Another Loan

    Quote Quoting Jmn22
    View Post
    How can they legally keep my title I already pay extremely high interest and thought I was going to be getting my title back after paying extremely high interest for over a year on the title loan its like I'm being forced to use my title and car as collateral for another loan when that was not what I agreed to with the signature loan....
    Maybe you did agree to it - in your contracts.

    Many such contracts often have a cross-collateralization provision.

    Read both your contracts.

  4. #4

    Default Re: Can a Title Loan Lender Keep Your Title as Collateral for Another Loan

    Many security agreements also encompass future advances secured by the collateral. It gives the company a greater incentive to make a loan to someone who would otherwise not be credit-worthy. You ask how they can do this, but the flip question is how can you expect them to loan you money if you don't have a good credit score without you posting some kind of collateral?

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