Cash 1 Blog
What Are Nevada Title Loan Laws?
If you would like to obtain a title loan in Nevada, specific Nevada laws offer you some forms of protection. You can also research the steps that must be taken by each lender when dealing with loans where the borrower defaults. You need to familiarize yourself with these laws before applying for a Las Vegas title loan or a title loan in Reno.
Title Loan Laws in Nevada
Nevada Revised Statute §604A.105 deals with title loans and other short-term loans. According to the Nevada title loan laws, any financial institution or individual that wants to be a title loan lender must be appropriately licensed to do so. Also, such a lender must post their licensing information, annual percentage rates, and other fees in a location that can be seen by everybody.
What Are the Requirements for Getting a Title Loan in Nevada?
Most requirements are universal to anyone who needs a loan on their car title, depending on where you live in the state of Nevada. These requirements are:
• A clean car title – the car title must have no lien, and you must be able to show proofs of outright ownership.
• Nevada car registration – the car must have current registration that is in your name.
• Driver's license – the license will be used to ascertain your age, identity, and residency in the state. You are not entitled to a Nevada title loan if you are not a resident of the state. Utility bill or mortgage statement can also be used as proof of residency when obtaining a title loan in Nevada.
• Proof of income – if you are an employee, your recent pay stub can be used as proof of income. A self-employed individual, on the other hand, can use their recent bank statement. Other forms of proof of income include a social security disability statement and an annual 1099 form.
Requirements for New Customers.
How Do Title Loans Work in Nevada?
To understand how a title loan works in Nevada, you should know that you're using your car as collateral. Consequently, if you default on the loan, it is legal for the lender to repossess your vehicle because it was used to secure the loan.
Generally, the current market value of your car determines your loan approval as well as how much you can get. Whether your credit score is excellent or not, the lender can still approve your loan as long as your car has positive equity. The application process of a loan on your title is usually straightforward, fast, and convenient, and these qualities often draw more borrowers who need financial aid to this loan option.
If you are applying for a title loan, here is the process:
• Visit the office of the lender with your car, car title, and government-issued ID. Some title lending companies allow borrowers to begin the process online.
• Speak to the agents and fill out the paperwork.
• Allow the lender to inspect and evaluate your car.
• Agree to the terms and valuation of your vehicle.
• Provide your car title and get the money you need.
What Nevada Title Loan Laws Say About Gross Income
When offering a title loan, each title loan company is required to consider the income of the borrower. Nevada title loan laws stipulate that the loan payment must not be more than 25 percent of your gross monthly income. You must provide proof of your monthly income so that the title lending company can verify if the amount of the loan is not over 25 percent of your monthly income.
Interest Rates on Nevada Title Loans
Title loan interest rates have no limit in Nevada; hence, title loan companies have the freedom of charging borrowers any amount they want. Notably, this is not unique to Nevada, as many other state laws do not have an annual percentage rate limit.
In Nevada, many companies that give you cash for car titles charge an interest rate of 25 percent each month. In general, the lack of an interest rate limit sometimes puts the borrowers at a disadvantage.
Nevada Title Loans Maximum Amounts
There is no stipulated limit for the maximum loan amounts that can be offered as a title loan to borrowers in Nevada. The only consideration is that the amount issued must be the fair market value of the vehicle used as collateral. Generally, no lender will approve a loan amount that exceeds the fair market value of the car of the borrower because they would like to get back the amount given out and the interest rate after selling the vehicle. In most cases, lenders will provide around 40 percent of the current market value of your car.
Nevada Title Loan Term Length
Nevada title loan laws stipulate that the title loan term should be for just 30 days as the borrower is expected to have the ability to repay the loan. However, in many situations, this loan term length does not materialize as the short payment terms make it difficult for lots of borrowers to repay their loans at the right time. Because these are high interest loans, the sum of the amount to be paid by the borrowers at the end of the 30-day term is sometimes too much for people who are in bad financial situation.
Borrowers can apply for title loan extensions if they are unable to pay their loans. Also referred to as renewing or rolling over the loan, a title loan extension requires the borrower to pay the interest charge and then get another loan term of 30 days.
The extension also attracts the same interest rate as the original loan agreement. The borrowers are allowed to extend the loans for as many as six different times.
Defaulting on a Nevada Title Loan
If you default on a title loan in Nevada, the laws allow the title loan company to repossess your vehicle. Although defaulting on a car title loan usually occurs due to failure to pay back the loan, violations of the loan terms are other reasons that can lead to defaulting on a title loan.
The title loan company is expected to take the necessary step of selling your car to get their money back within a specified limitation statute. For any written title loan contract, there is a limitation statute of six years. Verbal agreements, on the other hand, come with a limitation statute of just four years.
Nevada Car Repossession Laws
After defaulting on your payment, you are expected to get a written notice from the loan company at least 30 days before the repossession happens. The announcement offers you ample of time to take the necessary steps to pay the original loan. If you make the full payment before the 30-day notice lapses, you can avoid repossession.
Nevertheless, if you fail to pay the loan within 30 days, the lender takes over the ownership of your car after you have taken all personal belongings inside it. The lender must also send you a notification at least 15 days before selling the vehicle. If you are ready to pay the loan, interest, and any amount spent by the lender on repossession, you can still prevent your vehicle from being sold. However, if you fail to pay during this period, Nevada title loan laws allow the loan company to sell your car to recover their money.
It is also essential to understand that the laws stipulate that the lender should sue you in some cases. These cases include hiding your car from being repossessed, intentionally damaging your car before repossession, transferring the vehicle to another individual, and using false information to obtain a title loan.
Finally, you should carefully consider your options when applying for car title loans in Nevada so that you will not put yourself in a worse financial situation or a cycle of debt.
Joseph Priebe takes pride in assisting audiences with his articles to help them make sound financial decisions.
With over ten years of experience writing financial content his goal at CASH 1 has always been creating engaging and easy-to-digest information for anyone searching for immediate or long-term monetary solutions.
When Joseph is not writing about personal finance, you can find him photographing the Southwest United States with his 4x5 Graflex Crown Graphic camera. He is based in Phoenix, Arizona.