---
title: "Title loan: definition | Desert Rock Capital"
url: "https://www.desertrockcapital.com/glossary/title-loan"
description: "A title loan is a secured loan that uses the customer's vehicle title as collateral."
---

Loan types

# Title loan
All lending terms
Definition

A title loan is a secured loan that uses the customer's vehicle title as collateral. The amount is tied to the vehicle's value, and the lender can repossess the vehicle if the loan is not repaid.

A title loan, also called a car title loan or auto title loan, is a short-term secured loan in which the customer pledges the title of a vehicle they own as collateral. The loan amount is generally based on a portion of the vehicle's appraised value, and the customer usually keeps driving the vehicle while repaying. Because the title secures the debt, the lender may repossess and sell the vehicle if the customer does not repay according to the terms. Title loans are often short-term and may be renewed. The opposite arrangement, with no asset pledged, is an unsecured loan such as a signature loan.

Source: [Wikipedia](https://en.wikipedia.org/wiki/Title_loan). This definition is general educational information, not legal or financial advice.
Related

- [Compare: vs. a title loan](/compare/title-loan)
- [Unsecured personal loans](/services/unsecured-personal-loans)
- [Signature loans](/services/signature-loans)
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Signature loan
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Personal loan
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