While payday loans are a great financing option for smaller financial emergencies, they may not be able to help you when faced with expensive urgent costs like medical bills and auto repairs. If you’re looking for a payday loan alternative for emergency cash, title pawns in Alabama can help!

In this guide from Alabama Title Loans, Inc., we will explain a title pawn vs payday loan, including the differences in loan amounts, requirements, and benefits. We will also explain how title pawns online can help those who need fast financial relief for rising costs.

What Is A Title Pawn?

A title pawn is a payday loan alternative that allows you to borrow much larger sums of money than other lending types. It’s available to borrowers who have fully paid off their cars and can use their line-free car title as collateral.

Like payday loans, you don't need to worry about your credit score when getting title pawns. Instead, we use the value of your vehicle to establish how much money we can offer you. 

This is a great financing option for expensive emergencies. Rising costs from inflation have made it harder to save money for an emergency fund, hurting people’s ability to pay for unexpected costs.

Thankfully, title pawns can help if you need thousands for the following economic emergencies:

• Home repairs, including leaky roofs, broken front doors, and burst pipes
• Vehicle repairs like transmission replacements and tire changes
• Medical bills that your health insurance doesn’t cover 
• Health insurance or other insurance deductibles
• Out-of-hours veterinary fees
• Urgent travel costs like same-day flights back home to deal with a family crisis

Title Pawn Vs Payday Loan: What Are The Differences?

Title pawns and payday loans are both quick loans that can help you when faced with an urgent emergency. Alabama Title Loans, Inc. has an easily accessible online form that lets you start the approval process from the privacy of your home.

While both can help during emergency situations, there are differences that may make one more applicable to your emergency. Learn about the differences between online payday loans and title pawns below to help decide which is best for your financial situation.

The following are the differences between title pawns and payday loans online:

1. Loan Amounts

Payday loans are unsecured, short-term loans, so you will borrow less money. You can only get approved for up to $500. The idea behind a payday advance is for the borrower to repay their loan with their next paycheck, so the maximum loan amount is small.

Title pawns allow you to borrow up to $15,000 in emergency cash. You use collateral to secure the loan, so you get to borrow more money. This makes a title pawn better for more expensive emergencies.

How the loan amount for each is decided is also different. Payday loan amount is based on your income level, whereas the title pawn amount depends on how much your car is worth.

The following are the factors that can influence your title pawn value:

• Age — The older your car is, the less it's worth. Of course, this doesn't apply to classic vehicles, which can be worth more than modern cars. 
• Odometer reading — Generally speaking, the higher your mileage, the less your vehicle is worth. We consider the odometer reading in line with the car's age to decide whether it has high mileage. Average mileage is between 10,000 and 12,000 miles per year.
• Make and model — Premium makes and models come with higher price tags and are worth more than run-of-the-mill vehicles. 
• Condition — We pay close attention to your car's mechanical and cosmetic condition. Bumps, scrapes, and even stained interiors can impact its worth. 
• Modifications — While you may adore the spoiler, custom paint job, and decals, others probably won't. The best way to ensure maximum value is to remove customizations before attempting to get a title pawn. 

2. Eligibility Requirements

Alabama Title Loans, Inc. has simple requirements for both of these quick cash loans. However, you will need different items to get approved for both.

For a payday advance, you will need a state-issued ID card, your most recent paystub, a Social Security card, a blank check from an active checking account in your name, and a 30-day bank statement from your checking account.

The following are the required items for title pawns in Alabama:

• Identification — We suggest using your driver's license. However, you can use your passport, military and military dependents' ID card, or another type of identification that displays your date of birth, full name, and a portrait photograph.
• Lien-free title — We can only accept lien-free titles because we place a lien on your title to secure the title pawn, and we can't do that if there's already a lien in place. 
• Vehicle — We accept cars, trucks, or vans only. Please don't try to get a title pawn with a motorcycle, RV, trailer, tractor, or boat. 

3. Collateral Requirements

For a title pawn, you must use your lien-free vehicle title as collateral. While this can help you borrow more money, not everyone has fully paid off their car yet. It can be harder to get approved if you’re still paying off a car loan.

Alabama payday loans do not require collateral; you just need to prove you have income. However, the drawback to getting this quick cash loan without collateral is that you can borrow less money.

4. Credit Checks

When getting a title pawn, there may be a soft credit check to see your credit score. Not every loan lender will do a credit check, but some might. Regardless of your credit score, it should not affect your ability to get approved. You can get title pawns for bad credit, but your loan amount may be smaller.

Payday loans often don’t require credit checks because they are shorter-term, lower-value loans. Alabama Title Loans, Inc. will not conduct a credit check for payday loans.

5. Repayment Terms

How you repay a title pawn will depend on your financial situation. You can discuss this with one of our loan associates during the approval process. Some borrowers try to pay them off within 30 days, while others may take a few months of lump-sum payments to clear their debt.

A payday advance is less flexible in its repayment options. Most borrowers repay their payday loan with their next paycheck.

The Benefits Of Title Pawns

Now that you understand the differences between payday loans and title pawns, it’s important to realize what makes title pawns stand out. When facing thousands in emergency expenses, a title pawn is your best financial option. You can get approved the same day you apply and receive your funds within one business day.

The following are some of the benefits of title pawns:

• Borrow thousands in less than a day
• The approval process can take less than 30 minutes
• Borrow money regardless of your credit score
• Start the process online from your home or office
• Borrowing title pawns will not lower your credit score
• Keep your car during the title pawn repayment

How To Get A Title Pawn In Alabama

Ready to get a title pawn for an expensive emergency? Thankfully, the title pawn approval process is simple and only requires you to complete a few easy steps. The whole process can take less than a day, with the in-person portion only taking half an hour.

The following is the approval process for Alabama title pawns:

1. Complete the online form found on this website. It should only take you five minutes since we only ask for your basic information, such as your name, zip code, contact information, and vehicle details. 
2. We will give you a call as soon as we receive your information to discuss our title pawns in depth to ensure you understand everything. Don't be afraid to ask us any questions; our representatives know the loans inside and out. At this stage, you'll also set a meeting location at one of our Alabama store locations.
3. Bring your required items to the nearest Alabama Title Loans, Inc. store to you. We will look at your documents and inspect your vehicle to assess its value.
4. If you are satisfied with the amount, sign the loan agreement to complete the process. Finally, we release the funds, and you receive the money you need within 24 hours.

Borrow Title Pawns In Alabama – Receive Up To $15,000 In Emergency Cash Today!

When faced with a large financial emergency, you may need a payday loan alternative; title pawns can provide the funds you need to cover your urgent costs. Alabama Title Loans, Inc. has a simple, speedy approval process that lets you get fast financial relief today. Fill out our online contact form, and we will call you to guide you through the approval process!

Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.