Actually I am curious about this as well. Title Loans (typically) are outrageous and really just unfair to someone who is in a bind, but has legitimate collateral (The Title to their car, assuming the car is worth $5,000 or more) Does anyone know if people are doing this as an alternative to 'Title Loan Shops', I think this would be a great opportunity for lenders to make money, and people who get caught in an emergency, can receive help financially, and something as valuable as a car to back it up.
(Note: I have no idea, but I think it's in everyone's best interest to never loan/borrow more than 15-20% of the vehicle's 'Actual Value")
There's another issue in that a car title loan would take a long time to go through in Bitcoin time. Bitcoin ecosystem (or whatever trendy word you prefer) operates at ~10x normal speed - literally everywhere, it's expected. Even online with fiat, a car title loan is a relatively unexplored idea just because of the time required when someone can be approved for a credit card in a matter of minutes from the start of applying.
I don't think we're going to see really cool things happen again in "p2p" finance until pawn shops start really getting involved - but whichever entity involves itself, there needs to be central physical locations when dealing with government paperwork, and the person accepting the title should really be qualified to check whether or not the title's even legitimate.
Overall, though, I think it's really more of an issue with the antiquated system of property control we have, where governments keep everything on computers but people have to shuffle paper around. Smart contracts are a very reasonable solution to this and could have real-time enforcement of contract rules. For instance, if a lendee defaults, the car could give a warning, then, as soon as that lendee shuts his car engine off next (or have it done immediately if the engine's already off), lock the lendee out until he satisfies the contract requirements, with the lender having his privkey now accepted to engage the car's ignition (and unlock the doors, though I'm at risk of going off-topic, here), so repo is relatively simple assuming the lendee doesn't obliterate the car (in which case, it would maybe have to go through the horrible court process, though there are better solutions here, too).
There's nothing really preventing this from happening right now, just waiting for significant implementation, but it'll happen eventually, no doubt, and when lenders can have that REAL crypto-enforced security rather than a piece of paper representing a claim which needs to be proved to a court a thousand miles away (if even in the same country), rates can come way down. It may be a long-enough wait, though, where it'll really be our kids and grandkids accessing these new opportunities, not us so much, unless we're weird early adopters who buy a "smart contract car" literally just to test the lending opportunities out.
Smart contracts have many, many more benefits than just lending, though, so again - just a waiting game.
