If your car is paid off or you’re nearly done making payments, you likely have some equity in your vehicle — as long as it’s worth more than what you owe the lender. An auto equity loan allows you to take advantage of the equity you have in your vehicle.
Consumers often turn to these loans when they have an emergency need for cash. If you need to borrow money, perhaps for a car repair, you may want to consider using your car's value as collateral (security for the lender) so you can access money you otherwise wouldn’t be approved for.