How to Start a Car Title Loan Business
by Valencia Higuera
1. Do your homework. Learn your state's requirements before proceeding with opening a car title loan company. Contact the secretary of state's office for information on necessary permits, licenses and car title loan regulations for your state.
2. Prepare a business plan. Banks evaluating your financing application will need to see a copy of your business plan to see how you intend to run your car title loan business. Use a professional consultant to help you create a thorough business plan.
3. Familiarize yourself with the operations of a car title loan company. Contact loan companies outside your local vicinity. Speak to owners and ask questions about the business. Ask to visit the business and shadow or observe the owner and workers as they process loans.
4. Submit an application for financing to run your title loan company. You will need cash to write loans for your title loan business. Improve your credit score first by paying down debt and paying bills on time. Approach your bank and request a line of credit. You may use your home equity as collateral for the line of credit or other personal property, if you must to start the business.
5. Rent a location. Start small and select an small office space in a busy shopping district or choose a location that's easily visible from the roadways. Purchase operating equipment, such as computers, programs, printers and reception desk.
6. Check into existing businesses or franchise opportunities. If you don't want to start a car title loan company from scratch, check classified ads to see if any title loan companies are for sale in your area or buy into a franchise. Franchises typically offer training, and you'll benefit from the name recognition, and from implementing their successful business and marketing strategy.