If you're still paying for your car, you signed a contract that allows a lender to collect fees for late payments, no matter how excessive the fees might seem. Whether you have a traditional auto loan or a car title loan where you used your vehicle as collateral, you must pay any fees stated in your contract to obtain your car's title.
Your Loan Contract
Read over your contract to determine the accuracy of your late fees. Lending contracts outline the cost of late fees and when the fees are charged to your account, such as after 10 or 30 days. You might find that you're charged a percentage of the payment amount, including late charges. If you determine the late fees are incorrect, call your state's attorney general's office to find out where to submit a complaint. You only have to pay the fees stated in your contract, meaning the lender can't make up fees or charge you more than you agreed to.
Negotiating
After you determine the fees are accurate, try negotiating with your lender to decrease the amount of your fees. Review your finances to determine whether you can pay a portion of your fees in one payment, which may motivate the lender to accept a lower offer. For example, if you owe $500 in late fees, offer $250 to dismiss the remaining charges. It might prove difficult to negotiate with a lender to decrease your late fees because you agreed to pay the fees when you initiated your loan. The lender is within its rights to collect any money due before releasing the cars title.
Paying Your Fees
Ask to have your payment arrangement or the negotiated fee agreement in writing before you make your payment. Otherwise, the agreement is verbal, meaning you must still abide by the terms of your original contract. Keep a copy of the agreement for your records. If you can't negotiate a lesser fee amount, pay your late fees and find out when you'll receive the vehicle's title. If your lender is local, you might obtain your car's title immediately after making your last payments.
Title Release Process
It can take weeks before you receive your vehicle's title, even if your lender is local. Some lenders have a title processing department, but it often takes time to process payments and complete your state's title work. Your state's motor vehicle department also needs time to process your title. Ask your lender to rush the processing of your payment and title release if you need the title quickly. Some motor vehicle offices offer a rushed-title option, meaning you can receive your title faster for a fee.
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