A title loan and medical bills: which comes first, and how to keep the car

When medical bills land on top of a title loan, general budgeting guidance from the Consumer Financial Protection Bureau says to protect the essentials first: staying housed with the utilities on, obligations you must pay, insurance, and what you need to keep working, which for most people includes the car. Medical bills often come with ways to slow things down: you can check the bill for errors, ask about financial assistance, and ask for an interest-free payment plan. A title loan is tied to your car, so call the title lender before the due date, too. This guide walks through the order, the steps for each bill, and how to avoid losing the car while you sort it out.

You’re not alone

Medical debt is one of the most common money problems in the country. KFF’s Health Care Debt Survey found that 41% of adults have some debt caused by medical or dental bills, and that among them, 63% cut back on food, clothing or other basics, and 26% took out other loans. NPR and KFF Health News spent two years reporting on it in their “Diagnosis: Debt” project; NPR’s Sunday Story episode describes about 100 million people carrying medical debt. Title loans are often part of that story: the Pew Charitable Trusts found that about a quarter of title loan borrowers used the loan for an unexpected expense. If a health problem is why you’re in this spot, you didn’t do anything wrong. You got sick or got hurt, and now you need a plan.

Which bills usually come first

The CFPB’s Your Money, Your Goals toolkit includes a “Prioritizing bills” tool. It asks you to weigh the risk of not paying each bill right now and groups the ones to think about first:

This is general budgeting guidance, not a rule for every family. But it shows why keeping your health insurance and car insurance current matters even when money is tight, and why the car you drive to work deserves a plan. For a step-by-step version with a worked example, read behind on a title loan and other bills: what to pay first.

A medical bill can often be checked, reduced or spread out. A title loan is tied to the car you drive to work. Plan for both.

Steps for the medical bill

The CFPB’s guide on what to do if you can’t pay a medical bill lays out these steps:

1. Make sure you owe it. Ask for an itemized bill and look for duplicate charges, services you didn’t get, or a bill that belongs to someone else. Contact the billing office quickly.
2. Check your insurance. Compare the bill with your insurer’s explanation of benefits. If you think a claim was handled wrong, you can appeal.
3. Ask about financial assistance. Many hospitals, including nonprofit hospitals, have programs that provide free or discounted care to people who qualify. Ask the billing office how to apply.
4. Ask for a payment plan you can afford. The CFPB suggests negotiating the bill down to an amount you can pay or asking for an interest-free repayment plan. Nonprofit organizations may also help with medical bills or prescriptions.
5. Be careful about moving the bill onto high-interest credit. The CFPB warns that putting a medical bill on a credit card or a medical credit card can bring high interest and may limit your ability to negotiate the debt. The same caution applies to taking out a new loan against your car to pay it.

How not to lose the car while you sort it out

• Know your title loan due date and payoff amount. Pull out your agreement and ask the lender for your current title loan payoff amount in writing.
• Call the title lender before the due date. Explain the medical situation briefly, say what you can pay now, and ask about moving the due date or a short-term arrangement. The CFPB’s advice for car loans is to contact your lender as soon as possible and get any agreement in writing.
• Keep the car insured. It protects the car you need for work and appointments, and it’s on the CFPB’s list of bills to protect.
• Don’t take a second title loan to cover the first one or the hospital. Stacking loans on the same car makes the hole deeper. If that’s already happened, read what to do when an emergency title loan becomes the emergency.

Where a title loan refinance or buyout fits

Once the medical bill is on a plan, look at the title loan. If you can only cover the renewal fee each month, the balance may not be moving at all, and that leaves less room for the medical payments you just set up. Many people in this spot start searching for a way to refinance their title loan or for a title loan buyout. A refinance usually means another title lender pays off your loan and writes you a new one. A buyout means another company pays your current lender directly, the lender releases its hold on your title, and you then work with that company under a new written agreement. Whether either one changes your monthly picture depends on your payoff amount, your income and your car, so compare every option in writing. Our title loan refinance & buyout guide explains how each one works.

Where ReDrive fits in

Health problems are hard enough without worrying about your car. Our team in Plano, TX works with people across Dallas–Fort Worth who are juggling medical bills and a title loan at the same time. Bring your title loan agreement and your payoff amount, and we’ll go through it with you, without judgment. We’ll help you see what options you may have with ReDrive, including our title loan refinance & buyout program, with everything in writing so you can fit it alongside the medical plan you’ve set up.

Quick answers

Should I pay medical bills or my title loan first?

General budgeting guidance from the CFPB puts staying housed, keeping utilities on, obligations you must pay, insurance, and what you need to keep working near the top. Medical bills often have more room: you can check the bill for errors, ask about financial assistance, and ask for an interest-free payment plan. Because a title loan is tied to your car, call the title lender before the due date as well and get any arrangement in writing.

Can I get a payment plan for a medical bill?

Often, yes. The CFPB suggests asking the provider for an itemized bill, checking your insurance, asking about financial assistance or charity care, and then negotiating the bill or asking for an interest-free repayment plan. Many hospitals, including nonprofit hospitals, have financial assistance programs for people who qualify.

Should I use a credit card or another title loan to pay a medical bill?

Be careful. The CFPB warns that putting a medical bill on a credit card or medical credit card can bring high interest and may limit your ability to negotiate the debt. Taking out a second loan against your car adds risk to the car you need for work. Ask the provider about assistance and a payment plan first.

Can a title loan refinance or buyout help if I also have medical bills?

It can be worth looking at once the medical bill is on a plan. A refinance usually means another title lender pays off your loan and writes you a new one; a buyout means another company pays your current lender directly and you then work with that company under a new written agreement. Whether either helps depends on your payoff amount, income and car, so compare every option in writing before you sign.

This article is general information, not financial or legal advice. Programs, rates, and eligibility vary by lender and change over time. Always confirm the full terms in writing before you sign anything.