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New study shows certain vehicles used more often for title loans

Dec 08, 2012 Philip Burgess

When individuals experience a tough financial situation, they often go to short term lenders for relief. Many people have a favorite company they frequent during these troubling times, usually whoever will give them the best loan with the smallest amount of risk. Short term lenders, pawn shops and car title lending enterprises are some of the most frequented businesses in the sector. Increasingly, people are using the titles of their vehicles as collateral for a loan that covers emergency expenses. Not only is this helpful for the consumer, who can obtain fast cash and still get to drive their car, but it tends to be lucrative for the business owner as well. If the loan goes unpaid, the vehicle can be repossessed and sold. Recently, a report came out that found that certain makes and models of cars tend to be used as collateral more than others. Fords are the most popular for loans
According to a recently published study by car title lender Max Cash Title Loans in collaboration with MX Financial Services, businesses across the industry see some cars more than others. Rounding out the top five most popular cars that act as collateral for a short term loan include Fords, Chevrolets, Dodges, Hondas and Toyotas. Of the types considered, Porsches were the least commonly used vehicles, just edging out Harley Davidsons, though most companies won't accept motorcycles, the study found. The study also found that although the majority of U.S. vehicle purchases are imports, seven of the top 10 cars used for auto title loans are domestically made. The Ford Explorer is the most frequently seen vehicle, while the F-150 and Taurus took fourth and fifth place, respectively. This information also has the ability to influence other industries, representatives from Max Cash believe. "If I was a car dealer, I would be proud to tell the potential consumer that their car is in the top 10 cars that hold their value enough for refinancing down the road if they need to do it," explained president Fred Winchar. This data is particularly important because car title loans are becoming more popular in many areas, so lenders may want to get an idea of what sort of models they're most likely going to be seeing in the near future. According to The Associated Press, the industry saw a large boost in Virginia in 2011, based on data from the State Corporation Commission. Last year, lenders gave out more than 128,000 of these loans, worth around $125 million in total.