How to Pay Off Your Title Pawn Quickly

Title pawns provide quick access to cash for people with low credit scores who own their vehicle. While some states limit the amount of interest a title pawn company can charge, according to the Georgia Governor's Office, even with limits, the maximum yearly interest rate can be as high as 187.5 percent. If you are unable to buy back your title, the pawnbroker can charge you for his expenses if he must repossess your car. If you pawned your car title, the quicker you pay off the balance of your loan, the better it will be for your finances.

Instructions

1

Make a budget. It is essential that you pay as much as you can on the title loan until you pay it in full. Budgeting allows you to avoid any nonessential expenses until you repay your loan.

2

Borrow money from friends or family to pay off the lien. The interest you pay to an individual typically will be much less than what you are paying the title loan company. Sign a promissory note with the person lending you the money and make all your payments.

3

Work extra shifts or take a second job. The amount of interest you pay is directly proportional to the length of time it takes to repay the loan. If it takes you 18 months to repay a $400 title loan, you will pay more than $1,433 in interest, according to the State of Utah. Extra income will allow you to repay the loan sooner than scheduled.

4

Make payments as scheduled if possible. Late payment fees will be added to your balance if you make payments late. The title company will charge interest on the fees.

5

Ask your lender to reduce the interest rate. Title companies typically will not lower your interest rate because they know you probably cannot qualify elsewhere. However, if the company will reduce your rate, that will enable more of your payment to go toward your principal.

6

Offer the title company a settlement to release the lien on your title. As a title company's primary objective is to receive payment, offering a lump sum may be acceptable even if the amount is less than the loan balance.