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Home > Ask The Get Out of Debt Experts > I Might Get My Car Repossessed By LoanMart the Title Loan People. – Cynthia

I Might Get My Car Repossessed By LoanMart the Title Loan People. – Cynthia


“Dear Steve,

I have a loan with loanmart, I am exactly 13 days past due, and advised I will make my payment on the 15th which is in 3 days. They said I had to have payment in today or they will repossess my vehicle because it is a new loan. Last month they said my payment had to be in on time because it was a new loan and it was a first payment, and now they are saying the same thing.

I told them I will send them payment moneygram as I always do, which I had an account with them in the past. I told them if they take my vehicle it will make the situation worse because not only do I have to make that payment, then late fees. then impound fees and possible the next months payment in advance. I told them I need my car and without it I will have to pay for a bus for me and my kids to get to school and work. What can I do?

Cynthia”

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The Answer

 

Dear Cynthia,

I am not certain but I suspect that you are talking about 1-800LoanMart, the title loan people. A title loan works like this.

  • You need money.
  • You own your own car outright without any money owed against it.
  • You pledge your car as collateral for money borrowed against the title.
  • If you fail to pay as agreed they can take your car and sell it.

The auto title loan is a variation of the payday loan in that these are usually loans targeted towards people with bad credit or an inability to borrow from a more Main Street lender. One variation I’ve seen is the wheel loan folks that will lend you money against your fancy rims on your ride. If you don’t pay they they take the wheels off your car.

So what happens when the title loan folks take your car? They sell it for a lesser amount than it is worth and give you back the difference between what the car sold for and the loan you took out against it.

As much as it pains me to say this, if you can’t find anyone to help you get the note paid to avoid losing your car you might want to try a payday loan company. At least then you could borrow the money from them and prevent your car from getting taken. That would be an imperfect solution but the lesser of two evils.

Please update me on your progress by posting updates here in the comments section of your question. I’m very interested in how this works out for you.

Big Hug!

I Might Get My Car Repossessed By LoanMart the Title Loan People.   Cynthia
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About Steve Rhode

Steve Rhode
Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
  • Krobertson34

    I have a car title loan out on my car and it just broke down. Engine is locked up and I was told it would cost more to fix that what the car is worth. I now have to salvage it, but I do not have my title now until I pay off the title loan. Can I get a certified copy of the title from the DMV so that I can salvage the car and still pay the loan off?

  • http://merchantadvancefinancing.com/ MIchelle

    This is definitely a scary situation for anyone. A payday loan is in itself something that everybody should try to avoid from getting. But in this situation this seems to be the only option she has. Right now, the main goal would be not to lose the car, because this will in turn just create bigger problems for her.

    Isn’t it possible to probably negotiate with loanmart authorities, perhaps talk about a more flexible term for her? She obviously is willing to pay whatever she owes.
    .-= MIchelle´s last blog ..Business Working Capital For Purchase Of Medical Equipment =-.

  • marlee

    First I do not think you should advice her to get a payday loan to pay her title loan. That is peter borrowing from paul. what she should do is see if she can sell her car without the title and pay all the money back to the title loan people and get her title back and sign it over to the people she sold the car to, and with the rest of the money find a car company that will take a low downpayment on another vehicle.

    • http://GetOutOfDebt.org Steve Rhode

      Marlee,

      That’s an option. But isn’t a $100 payday finance charge to get her paid for car back cheaper than a new auto payment or an older and possibly less reliable car?

      I realize that going to a payday lender seems counterintuitive but there are a few situations that it can make sense. As ironic as it sounds, a payday lender is cheaper than a Main Street bank for things like overdrafts and bounced check charges. There are some times they can be used not only to your advantage but cheaper than more mainstream solutions.

      Steve

  • http://www.samedaypaydayloansonline.com/ Kenneth Elliott

    Wow, this story is painful to hear. But, a payday loan sounds like the only option that she has. Unless, she has something of value that she may be able to pawn. That may be another option.
    .-= Kenneth Elliott´s last blog ..Quick Payday Loan =-.

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