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Title loan is the loan where borrowers must provide an asset as collateral. This term is commonly used in the US. Usually a car is provided as title and it is also called as car title loan.
Title loans are considered risky assets by lenders and they charge high interest on them. Lenders do not require actual possession of the vehicle. The car provided as collateral should have clear title. Lenders typically lend up to half the resale value of the vehicle.
These loans are more popular among those who do not have great credit background for the fact that lenders do not check credit details of borrowers. They only consider the value of the vehicle. Another reason why title loans have gained popularity is that they can get sanctioned in a few minutes' time.