A title loan is a high-interest and short-term loan. Usually, title loans are paid in just 30 days. Car title loan is a money making business, and there are few steps to be considered in this particular process.
Apart from attaining the experience, licenses, and creating the plan, you need to understand the capital that is to be obtained and the cars to lend.
- Gain knowledge on business related to online title loans. If you are not familiar with how the industry works, it is recommended to build a relationship with a successful lender for at least one to three years. If you are seasoned pro, then decide yourself on the type of lending that makes sense for your company. If you’re not sure, it is better to contact companies outside the market and request them for inside information about money lending on car titles.
- Create a business plan that allows you to design your objectives and goals. A good business plan does include financial reports like list of assets, profit-loss statements, and marketing plan. A business plan can also be created with an accountant or it can be done via kit or a template.
- Start looking for an appropriate location. Before you apply for a license, you need to incorporate the business and you should apply for financing. Title loan companies do the best when it comes to busy retail areas. You just need to select an office that is good enough for all the clients for completing the applications in perfect and clean reception areas. You can also install service counter for easy transactions. You can also try with a real estate agent who can show you the ideal place that meets all your requirements.
- Start contacting the state’s office secretary for finding licenses that you require to start a lending company. Few states may require business license, and others require dedicated permit. Your state also requires loan companies for meeting lowest asset requirements with all the background and credit checks done with respect to owners.
- You can also obtain the working capital for attaining loans and paying the start-up expenses. Most of the companies afford loans obtain credit lines from the commercial banks. For applying, you just need to submit business plan for a commercial banker. The necessary qualification is completely based on the plan strength and credit report. If you cannot get bank loan or line of credit, then you need to seek help from investors.
- You need to screen customers intelligently and it is necessary to know the collateral well. Make use of “Kelley Blue Book” for checking used car values. Better consult a qualified pre-owned car dealer, who can help you in determining the condition of the car that you lend before attaining the loans.
You should not operate without a proper license. Make sure that you have clearly written contracts in order to avoid attaining the cars without any sort of legal rights. You need to price all your loans in a wise manner.