How Title Pawns Work

How Title Pawns Work

If you’re reading this page you’re probably interested in learning a little bit more about how a title pawn actually works. On this page we’re going to do our best to simplify and explain exactly how it works, while focusing on Georgia law and our company policies here at Southside Title Pawn.

In the state of Georgia, a title pawn is essentially a short-term loan using your title as collateral for the loan. Many people are sometimes unaware of the distinction between a title loan, and a title pawn, whereas the legal definition of a pawn is different from that of a loan (see Ga. Code §§ 44 - 12 - 130 et seq.).

We are not going to compare the two definitions here on this page, instead we’ll be focusing on the overall process of a title pawn, and how you can pay it back in Georgia. For more in-depth information on what a title pawn/loan is, we recommend reading the Wikipedia page, or just give us a call and we will answer any question you may have.

How Title Pawns Work at Southside

A title pawn is a short-term auto secured loan. Instead of getting a loan from a bank/finance company where you stuck into payments like 12, 24, 36, or even 72 months, a title pawn is a one-month loan. You are only required to pay your interest on your title pawn at the end of your 30 day period, which will then extend you for an additional 30 days. If you cannot pay off the entire balance by the end of the first 30 days, you may add additional months as necessary by paying your interest and renewing the loan.

There is a flat-fee of up to 25% interest on the title pawn for that 30 day period, after 3 extensions on your loan the interest rate will drop down to 12.5%. As an example, if you borrow $100 on your car title, your fee/interest would be $25, and if you were to pay this off in a 30 day period your total payoff would be $125. There will never be any additional fee’s including into your title pawn, unless there is a lien fee to register the security interest with the state. There also maybe additional fee’s if the vehicle is repossessed or there is a breach of contract.