The real cost of a car title loan equals loan principal plus interest plus origination fee (if applicable) plus additional fees depending on your circumstances.
Before taking out a car title loan, consider all the fees you will have to pay. Here are the main ones:
1. Origination fees
2. Late payment fees
3. Prepayment penalties
Origination fees can range from $30 to $100, depending on which lending institution the borrower chooses.
If you do not make your next payment by the due date, you will pay a late payment fee. This fee will average about $25 for each missed payment. The penalty for paying off your loan early is usually a percentage of the total loan amount, or it may be a flat amount, depending on which amount is higher.
These loans are convenient and allow you to borrow even with a bad credit history. But at the same time, if you violate the loan agreement, you risk overpaying more than 50% of the initially negotiated amount. Thus, we can define that car title loans are not the cheapest loans in the US.