How do title loans work in Utah?

Cory B

September 13, 2023

min read

Title loans are short-term loans offered with a vehicle title as collateral. It provides a solution for individuals needing cash by leveraging their vehicle's value. That said, these loans often come with high-interest rates, so it’s important to understand how they work.

Are title loans legal in Utah?

First, it's crucial to mention that title loans are legal in Utah, without any cap on the financial amount that can be borrowed (1). This means lenders in Utah can provide a loan proportional to the full value or more of your car; it depends entirely on their risk appetite and your ability to repay the debt.

Rules and regulations

Utah's legislation offers no specified maximum loan terms, allowing lenders to set terms based on contractual agreements with the borrower. Similarly, there's no cap on the interest rates or fees charged by these lenders (2).

Utah state law, however, demands that all lenders be registered under the Utah Department of Financial Institutions. This rule aims to ensure all lenders' compliance with the stipulated regulations to maintain a fair lending environment (3).

Disclosing Title Loan Terms and Conditions

Under the Truth in Lending Act, lenders are obliged to disclose the terms and conditions of the loan agreement to the client before signing the contract, which includes the APR, total finance charge, and the payment schedule (4).

What if a borrower cannot pay?

Generally, if a borrower fails to meet their repayment schedule, the lender has the right to repossess the vehicle to recover the loan amount.

While title loans can provide fast access to cash at a moment's notice, borrowers must carefully evaluate the terms and conditions, interest rates, and fees. Always consider alternative loan options, such as credit card loans that leverage on your car's value, before opting for a title loan. You can see how Yendo compares here.

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The Yendo Card - The Title Loan Alternative

Yendo is the first credit card that's backed by the value of your car, so you can use your car title to get a credit line of up to $10k.

The card can provide access to credit for those who might not be able to qualify for other credit cards. It's a real credit card, powered by Mastercard, that provides credit limits from $450 - $10,000, depending on the value of your car.

So, rather than re-applying for loans, for example, you can access funds an ongoing basis and, with responsible usage like on-time payments, build your credit too.

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Features & benefits of the card

‍Credit limit - access up to $10k in credit
Only pay for what you spend - it's a credit card, so you only pay for what you spend, plus interest and fees. Or, if you pay off your balance each month, you only pay for what you spend.
App - the Yendo app lets you manage your account, wherever you are‍
Virtual card - access a portion of your credit limit prior to getting your physical card in the mail with the Yendo virtual card. Use your virtual card in addition to your physical card‍
Cash advances - ability to do cash advances on your card if you need to access money quickly‍
Access to revolving credit – you’ll have a revolving line of credit that opens up as you make payments‍
Credit reporting – all your account activity will be reported to the credit bureaus, giving you the perfect opportunity to build your credit

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Resources

‍https://le.utah.gov/xcode/Title7/Chapter24/C7-24_1800010118000101.pdf‍
https://le.utah.gov/xcode/Title7/Chapter24/C7-24_1800010118000101.pdf‍
https://le.utah.gov/xcode/Title7/Chapter24/C7-24_1800010118000101.pdf‍
https://le.utah.gov/xcode/Title7/Chapter24/C7-24_1800010118000101.pdf

Disclaimer: Yendo is not a provider of financial advice. The material presented on this page constitutes general consumer information and should not be regarded as legal, financial, or regulatory guidance. While this content may contain references to third-party resources or materials, Yendo does not guarantee the accuracy or endorse these external sources.

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