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BlogBlogTitle Loan Vs Pawn: What You Need to Know

Title Loan Vs Pawn: What You Need to Know

pawn shopGetting confused when you hear people talk about pawning their car? Well we can understand why. Turns out a title loan and a title pawn are essentially the same thing. Some states refer to this type of secured loan as a title loan while other states refer to it as a title pawn. The reason this is confusing is because people always think of a pawn shop loan that you get on a valuable item like a watch. That kind of pawn is completely different.

Pawning Items

A “watch” pawn is where you take your item of value to the local pawn shop, and they offer a cash amount based off its value. There is a catch, though. They hold onto the pawned item until you have the cash to pay back the pawn broker plus a little bit of interest. In Florida, it is limited to 25% interest per month.

The advantage of a pawn is that you do not need a clear car title or even own a car. It is a good short term solution for a small financial need. The keyword here is small financial need. Pawn shops typically do not offer huge amounts of money as loans. There is often a limit that is set, even if the item being pawned is of high value.

Title Loans

On the flip side is the car title loan (or car title pawn, as some people call it), which does not typically have an upper limit. Car title loans allow the borrower to borrow as based on the value of the car. Loans can range from a few hundred dollars to near ten thousand dollars.

The best way to find out how much you could borrow on your car using your car title is to call a title loan company like Embassy Loans. To get an estimate you just need to know the year, make, and model of your car. Provide this information along with your contact information and they can quickly tell you how much money you could potentially borrow.

Of course, the biggest advantage of a car title loan over pawning your watch is that you can continue to drive your car while you still have an active loan account. With a pawn, they hold onto the item until you pay them back. With a car title loan they just hold the car title and you can still keep your car.

The folks at Embassy are happy to help you with all of your questions about auto title loans. Give us a call at 833-839-2274 and we will do our best to help.



Embassy Loans is a leading provider of auto title loans since 2005

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Embassy Loans Inc. is licensed under the “Florida Consumer Finance Act” and as such Embassy Loans is exempt from any licensing requirements under the “Florida Title Loan Act” to the extent that any of Embassy Loans’ activities involve the making of a loan of money to a consumer secured by bailment of a certificate of title to a motor vehicle.

Monthly Interest Rates range from 1.5% to 2.5% (18% to 30% APR), with 15-18 Month Terms.

No Prepayment Penalties!

Embassy Loans uses “Title Loans” for advertisement purposes only and provides auto equity loans. Embassy Loans Inc. is licensed under the “Florida Consumer Finance Act” under Florida Statute 516 and as such Embassy Loans is exempt from any licensing requirements under the “Florida Title Loan Act” to the extent that any of Embassy Loans’ activities involve the making of a loan of money to a consumer secured by bailment of a certificate of title to a motor vehicle.

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Frequently Asked Questions

What is an Auto Equity Loan?

An auto equity loan, sometimes known as a car title loan or a car equity loan, is a type of loan that allows you to borrow money by using your vehicle as collateral. The loan is secured by your vehicle, meaning you agree to use the equity in your car to back the loan. 

What is an Unsecured Personal Loan

An unsecured personal loan is a loan that does not require collateral. Funds are provided based on your credit worthiness and your ability to repay. 

What Is the Credit Builder Program

The credit builder program is designed to help individuals establish or improve their credit score with the primary purpose of building a positive credit history through regular payments.

Can i have more than one Loan at a time?

Embassy Loans can only extend one loan at a time and it’s advisable to start with one and focus on making payments in a timely manner to prevent default.

What happens if I miss a payment?

Missing a payment can have negative consequences, including late fees, a drop in your credit score, and potential default on the loan. Consistent, on-time payments are crucial to benefit from the program.