You’ve decided an online title loan is your preferred way to get money. But before you head to a website or brick-and-mortar storefront, you wonder if making on-time payments will improve or even harm your credit score. In other words, will the title loan company report your payments to the three major credit bureaus? Here’s the thing: There is no industry standard for reporting a borrower’s information to credit agencies. Experian and Transunion both say that in most cases, direct online title loans won’t impact your credit score. Equifax has not commented on how this form of borrowing can affect your FICO score.
Do Vehicle Title Loans Go Against Your Credit Score
Borrowers that take out title loans are likely past the point of worrying about their credit score. If you had decent credit, a personal loan or bank financing would be the best option, but one benefit of title loans is that they may help your credit rating! Beyond that, they won’t go against your credit score unless you default or miss multiple payments.
The lack of a “hard inquiry” is significant because it won’t knock it down five or fewer points. Do you want to boost your score by showing healthy consumer habits (i.e. repaying the loan)? 
Sometimes that may be a problem, as it won’t go on the monthly reports.
Do Car Title Loans Get Reported On Your Credit History
Most online title loan companies will not run a typical credit check when you apply for a secured loan and the larger lenders won’t report payments that go on your credit score. They may do so, but most lenders say that no credit checks are done upfront on their site. Instead, they check your viability as a borrower by looking at:
• Your proof of income
• Your bank details
• Your vehicle’s value
Based on those factors, companies that fund online title loans will approve or decline your application. Remember that they may report your timely payments to the 3 different bureaus. It is almost a given that they will report any failure on your part to meet the loan terms. In other words, default or skip payments and it is likely you’ll see this as a negative issue. Expect a reduction in your credit or FICO score. Any drop can make future borrowing and credit acquisition less likely.
Can Auto Title Loans Build Your Credit Score?
Many visitors use our site to find title loan companies near me because other finance companies have turned them down. Most borrowing options are not available to them. But they may wonder why the lender doesn’t look at their credit report or score. The answer is quite simple when it comes to the loan amount. Applying means you have a vehicle with a value that will be used as collateral against the loan. Should you default on the loan payments, the lender may repossess that vehicle and sell it to offset any loss. It is almost no real risk to them to make the loan. Secured loans are often at a higher interest rate than other consumer borrowing options. You can see why they don’t need to peek at your report or score.
What if you are aiming to repair your credit score or borrowing history? 
Will the title loan do you any good? It varies widely; some companies may report positive and negative issues on your account. If you aim to boost your score, this could be an excellent way to attain that goal. But it will require research and a direct inquiry into the individual lender’s methods. That way, you can determine if they are making those positive reports. If so, you may also want to look into a title lender who enables you to make automatic payments and pay down the debt. Setting up auto-pay can sometimes decrease an interest rate and help you avoid defaulting on the monthly payments.
Do All Auto Title Loan Companies Report Payments To The Credit Bureaus
If you still worry that your shaky credit may impact your ability to get a car title loan, let’s take a quick look at just how this process works. The lender wants to know if your vehicle’s title is “clean” and often doesn’t worry too much about your credit score. Meaning there is no loan against and you own it free and clear. Your name must be on the title, and there has to be a certain amount of value to the car. If it has a salvage title, you may still get funding. But it may be less than what you’d expect as a salvaged vehicle is difficult to resell (should you default on the loan).
How To Improve Your Credit With A Lender That Reports To The Credit Bureaus
You complete the application, and the lender uses what is known as the Kelley Blue Book to determine what a realistic market value might be for the car. You then get around half of the value of the loan. The application processes will vary with each company. But, this is the general overview of how an application works and what it requires. Using a vehicle as collateral can be an excellent way to get fast cash, and you won’t have to worry about any hits to your credit history. There may be a benefit when all is said and done as most companies report on-time monthly payments to the three credit bureaus!
