The interest rates on most of the title pawn type places are effin astronomical, that's one of the reasons it's referred to as predatory lending. They know good and well that people coming in the door are unlikely to be able to pay back loans at 500% or higher interest rates; they are also acutely aware of the fact that most of the folks they loan money to have no other options.Yep, vehicle as collateral, but on paper - they hold the title and rights to it, you keep the vehicle and continue driving and (hopefully) paying on the loan. You default, they send the repo man. It's obviously not legal in all states. I had never heard of it until moving to GA back in the late 90's and noticed them there; when I moved back to TX they were suddenly all over the place as if a law changed here that now allows them. The number of vehicles for sale here with "lost" titles is ridiculous, especially for a state that is relatively easy to obtain a replacement title if you are the registered owner. My bet is a very large amount of them are lost to title pawn. I've asked sellers directly and every now and then one will be honest and admit that is the case.
Richard
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