A loan where an asset is required as collateral. These loans are popular for two reasons. The first being that with this type of loan, the applicant's credit rating is not considered. The second being that title loans can be approved very quickly and for loan amounts as little as $100 in most cases.
Investopedia explains Title Loan
The lender will not usually require the actual physical retention of the collateral. Many simply require that they hold the proof of ownership of the asset. For example, in a car title loan, having a second set of keys, a tracking device or the ability to disable the ignition would suffice. However the borrower must hold clear title to the car, with no current financing or liens on the vehicle.
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