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What is a Minnesota Title Loan?

A Minnesota title loan means a title loan regulated by the legislature of Minnesota relevant to title lending. Title loans are small, short-term, high-interest loans which are secured by an asset the borrower has put up as collateral (usually a car). This means that, if the borrower finds themselves unable to make a loan payment, the lender may then repossess the asset and sell it to pay the balance of the loan.

Because title lenders can be predatory, title loans are not legal in every state, and the states in which they are legal will feature specific laws in order to regulate lending habits and protect borrowers from procuring severe debt. Such laws often include caps on interest fees or loan amounts, and restrictions on rollovers (title loan renewals).

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Rates (%)

Title loans tend to have high-interest rates, and some states have no limits on what title lenders can charge for interest. On average, rates tend to be around 25% per month (an APR of 300%). In Minnesota, rates are restricted according to pawnbroker regulations and are capped at only 3% per month.

Credit Requirements

Title loans are secured, or guaranteed, by leveraging the value of an asset as collateral, which means the borrower’s credit is generally of little importance to lenders. If, say, a borrower has bad credit and cannot make a loan payment, the lender simply needs to claim the title to the collateral. Therefore, all that is usually needed to obtain a title loan is an asset with no existing liens, such as a vehicle.


Minnesota has the following legislature as regards title lending:

47.602 – Title loan lenders must be licensed.

47.602 – Title loans cannot be for an amount greater than $1000.

47.602 – Lenders may not set monthly payments at a rate higher than 3%, according to pawnbroker regulations as stated in 325J.07.    

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