Can a car that is not your own be used for a mortgage loan?
2 Answers
Yes, as long as the vehicle owner agrees, this type of loan is called an auto title loan. Here is a detailed introduction to the relevant information: Auto Title Loan: An auto title loan is a loan obtained from a financial institution or auto consumer loan company using the borrower's or a third party's car or self-purchased vehicle as collateral. Used Car Loan: Used cars can be mortgaged for loans, but the conditions are very stringent. Although many banks do not refuse used car title loans, they impose numerous conditions. You must provide proof of purchase intent, a vehicle evaluation report, the seller's vehicle ownership certificate, the annual inspection certificate of the motor vehicle, and ensure that the loan amount does not exceed 50% of the vehicle's total price. Some banks even require that applying for a used car title loan must be secured with real estate; otherwise, even if all five conditions are met, the loan will not be approved.
I often encounter friends asking if they can use someone else's car as collateral for a loan, but in reality, it's a no-go. Banks or lending companies strictly stipulate that only the car owner is eligible to use the vehicle as collateral for borrowing. This is because the process requires you to prove ownership of the car—if your name isn’t on the vehicle’s title, how can they trust you’re the rightful owner? Trying to force the issue could land you in legal trouble, such as being accused of theft or fraud. So, if you’re not the owner, don’t even consider it. If you’re in urgent need of money, you could try applying for an unsecured personal loan or seek a family member’s guarantee—it’s safer and legal. From experience, many similar cases end in failure, wasting time and effort for nothing. Don’t create unnecessary trouble for yourself.
