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Fast Title Lenders > Tax Refunds and Title Loans

Tax Refunds and Title Loans


It is getting to be tax time again and for those with a refund coming that can be good news. On the other hand, if you owe money, then it may not be good news. The question we’ll answer today is how to use a tax refund to qualify for and repay a title loan.

Waiting for a refund may not be a great option if you have expenses to cover immediately. In these cases a title loan can provide the fast funds you need today while you wait for the refund to be processed. Doing so requires some preparation and thought.

Can I use a Tax Refund to Qualify for a Title Loan?

Car title loan requirements include the following at a high level:

  1. Vehicle with Equity
  2. Lien free Title
  3. Drivers License
  4. Ability to Repay the Loan

The part where the tax refund comes in is the ability to repay the loan. If you do not have other income to support the loan amount then yes the funds from the tax return can be used to justify the loan amount.

Getting a Title Loan with a Tax Refund

Title loans are often used to cover emergency or unplanned expenses. This is often when time is of the essence. If you have a tax refund coming, you can get a title loan to get the funds needed immediately without waiting for the return and refund to be processed. This has both pros and cons; or advantages and disadvantages.

Pros of a Title Loan

The main pro, or advantage, of a title loan is the speed at which you can get funds needed. With an instant online title loan the funds needed can be acquired the same day. This is an advantage especially for expenses and situations where you don’t have time to wait for other sources of funding.

Cons of a Title Loan

The biggest con, or disadvantage of a title loan is the cost. In some cases title loans can be very costly. This is especially true if you choose a lender that charges the maximum allowable rates in your state. There are ways to mitigate this.

The first way to reduce the overall cost of a title loan is to find the lowest rate possible. Additionally, the shorter the loan the lower the overall costs. Since title loans do not have prepayment penalties, paying off the loan in full as soon as possible can help keep the overall cost down.

Repaying a Title Loan with a Tax Refund

To figure out whether or not it makes sense to get a title loan with the idea of repaying the loan with proceeds from a tax refund it is important to understand when that refund is expected. Assume the worst case scenario and factor in some extra time in case there is a delay.

additionally, borrow only what you can afford to repay, even while waiting for the tax refund. In other words make sure you can afford the monthly payment regardless of how long it takes. As a secured loan there is the possibility of losing the vehicle if you default on the loan.

Preparing for a Title Loan

The first step in moving forward with any title loan is preparation. This is an important step and should not be overlooked. Preparation includes the following at a high level:

  1. Finding the best title loan company
  2. Gathering required documentation
  3. Valuing your vehicle
  4. Taking vehicle pictures
  5. Detemrining loan amount and term length

Once you’ve properly prepared then the next step is to apply. You can usually apply online for instant approval.

Tax Refund for a Title Loan Refinance

Some borrowers already have a title loan that has excessive costs. This may be for several reasons, one of the main reasons being the original loan was rushed into without taking the time to find the best title loan.

In these cases if you have a tax refund coming it may be possible to use this as a payment form for qualifying for a title loan refinance. Refinancing your title loan at a lower rate can save a significant amount of money.


Any source of future income can be used to repay a title loan. This includes funds from a tax refund. If you have a refund coming, but need funds immediately, a title loan is an option to meet this need.