If you’re in need of quick cash and unable to obtain a loan from your local bank, a car title loan could be the solution. It is a kind of short-term lending where the borrower (you), surrender your car title in return for quick cash. Simply put, you pay back the loan within 30 days usually or you can go to a full year. You get to take back your car title as soon as you pay back the loan. If you fail to fulfill the conditions of the agreement, the lender has the right to reclaim your vehicle. Harsh as these terms may seem, rest assured the lender is only interested in getting back the money loaned, rather than keep the vehicle. Hence, there’s provision for the borrower to make payment arrangements that are suitable.
Sadly, title loans have a negative reputation in today’s society. This is as a result of exorbitant interest rates coupled with the fact that a borrower could lose their car. Just the thought of not being able to keep their jobs or care for their family is enough to make them overly anxious. Some people think that loans like these are deliberately designed to exploit those already in need as well as further impoverish them. Nevertheless, a recent study has shown that car title loans aren’t as bad as people think and the reasons include:
They Offer Competitive Interest Rates Compared To Banks
That a borrower is not qualified to obtain a loan from a standard bank because of lack of credit or other monetary problems does not automatically imply that the interest rate gotten from a title lender will be exorbitant. In actual fact, several lenders, particularly the ones genuinely interested in creating a good reputation for loans like this in the financial community, are devoted to giving interest rates that are similar to what you’d normally get from a traditional bank.
Low Rates of Repossession
Thinking about your car being repossessed is scary. The possibility of it happening is all the discouragement they need to steer clear of car title loan. Nonetheless, it is vital to look at this from a different perspective. According to Texas Office of Consumer Credit Commissioner, it was found that cars involved in title loans which were actually repossessed is 3.73% in 2016. The vast majority of title loan beneficiaries never come across the repo man.
Title Loans Will Not Affect Your Credit Score Negatively
The process of approval for car title loan is very fast and that’s fantastic news. So, if you are worried that borrowing money through this means could influence your credit score negatively, this is advantageous to you. Usually, loans are approved within minutes because lenders don’t bother checking with the credit bureaus at all. Overall, your credit score can only be affected if you fail to make your payments in good time or fail to pay back the loan completely.
You Still Get To Utilize Your Car
One major advantage of car title loan is that you’re able to get the cash you need very fast and at the same time keep the car to use for your shopping, school runs and work.
When the majority or all of your car payments have been paid and you are in need of some quick cash, why not call American Title Loans and speak with a car title lender to find out if this kind of borrowing is ideal for you?
At American Title Loans, our team of committed and friendly staff will help walk you through the entire process, making it simple and easy to understand. They will ensure that you don’t make the mistake of borrowing what you won’t be able to pay back.