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What is a Title Loan?
A title loan is a loan of money secured by a certificate of title to a motor vehicle. The the title loan lender keeps the certificate in case the loan is not paid.
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Title Loan Lenders Must Be Licensed
All title loan lenders must be licensed by CSD in order to engage in the title loan lending business in Miami-Dade County. The license requires a title loan lender to have a bond in the amount of one hundred thousand dollars ($100,000.00) that protects consumers who are injured by any failure of the title loan business or violation of the law by the title loan lender. Each title loan lender undergoes a criminal background check to ensure that the lender is qualified to issue a title loan.
Note*: To download and fill out a permit and/or license application, visit the permits page and view a listing of permits and licenses separated by division.
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How To Tell If The Lender Is Licensed
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A current license issued by CSD must be conspicuously displayed at the title loan lender's place of business. The business address on the license must match the title loan lender's location.
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A title loan lender must include in any advertisement the current valid license number issued by CSD and the name under which the business is licensed.
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To verify that a motor vehicle title lender is licensed, call the Consumer Hotline at 305-375-3677.
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Agreements Must Be Written
The title loan lender must give each borrower, at the time the loan is made, a written title loan agreement in English, Spanish or Creole. The agreement must include:
- the make, model and year of the motor vehicle being used as security
- the vehicle identification number and the license plate number
- the name, address, date of birth, physical description, and social security number of the borrower
- the date of the transaction
- the identification number and the type of identification, including the issuing agency, which was accepted from the borrower
- the "amount financed"
- the maturity date of the title loan agreement
- the total title loan charge payable on the maturity date, designated as the "finance charge"
- the total amount, amount financed, plus finance charge, which must be paid to redeem the loan property on the maturity date, designated as the "total amount of all payments"
- the annual percentage rate
- the name and address of the title loan office
- the name and address of the CSD, as well as the Consumer Hotline telephone number to which consumers may address complaints - 305-375-3677
- The following statement printed in not less than fourteen (14) point bold type: "Your vehicle has been pledged as security for this loan and if you do not repay this loan in full, including the finance charge, you will lose your vehicle. You are encouraged to repay this loan at the end of the loan period. The lender is not required to extend or renew your loan. This loan has a very high interest rate. Do not complete this loan transaction if you have the ability to borrow from another source at a rate lower than two and one-half percent (2 1/2%) per month or an annual percentage rate of thirty percent (30%)."
- the contract must contain a blank line below the statement for the initials of the borrower.
Borrowers should read the contract very carefully and make sure they understand what it means, before you signing it.
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Maximum Interest Rate and Changes
A title loan lender may charge a maximum interest rate of 30 percent per annum computed on the first $2,000 of the principal amount, 24 per cent per annum on that part of the principal amount exceeding $2,000 and not exceeding $3,000, and 18 percent per annum on that part of the principal amount exceeding $3,000.
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What Happens If You Don't Pay The Loan?
If you fail to pay the loan, the title loan lender may repossess your vehicle. However, the title loan lender must first give you the opportunity to make the vehicle available at a date, time, and place of mutual convenience. You have the right to remove your belongings from the vehicle at no additional cost. If your vehicle is sold, you are entitled to any proceeds of the sale in excess of the amount you owe and the lender's reasonable expenses for repossession and sale.
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What If You Have A Consumer Problem?
First, know your rights. Then, contact the lender and try
to work it out. Keep a record of the names of persons you talk to and what they tell you. Keep copies of any relevant receipts, letters, etc. Be honest with your lender. If you are unable to pay, but show a willingness to satisfy the loan, the lender may be willing to work with you. If you are not successful or if you think the lender has not followed the law, you may wish to consider filing a formal complaint.
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Prohibited Practices
Title loan lenders may not do any of the following:
- Impose illegal charges in any title loan transaction.
- Enter into a title loan agreement for an amount of money that exceeds one-third of the value of the motor vehicle.
- Refuse to accept partial repayment of the amount financed when all accrued finance charges have been paid.
- Charge a prepayment penalty.
- Fail to remit to the borrower all surplus proceeds from the disposal of the vehicle within thirty (30) days.
- Commit any act of fraud, misrepresentation, deceit, or gross negligence.
- Engage in false, deceptive, or misleading advertising.
- Fail to keep all records or refuse to permit inspection of all records by CSD.
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Signs Must Be Posted
The title loan lender must prominently post a sign no smaller than three (3) feet by five (5) feet that lets you know what happens if you do not pay the loan and the interest rate.
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Complaints
If you cannot resolve a dispute directly with the motor vehicle title loan lender, call Miami-Dade's Consumer Services Department, Consumer Hotline at 305-375-3677. An experienced Consumer Protection Enforcement Officer will instruct you on how to file your complaint. Your complaint will be investigated and you will be notified of the results. If violations of the Ordinance are detected, the business will be subject to enforcement action. Or go online and fill out a complaint form online which is sent via email automatically.
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