Easy Financing with Car Title LoansMay 8, 2019
A bad credit history doesn’t reflect your character, but it does affect how your bank or lender sees you. Poor credit means you cannot secure a loan from your bank. Some lenders may also decline from approving one. This is where a car title loan comes in.
What Does a Car Title Loan Do?
An auto title loan enables a borrower to get quick and easy finance using the car title instead of their credit score. Your title loan is determined by the amount of money needed, the value of the car, and the borrower’s ability to repay. It is important that the borrower gets a manageable amount. Auto title loans are popular for 2 reasons. One is that the credit rating of the applicant is not taken into account for an approval and two; the loan is approved very fast.
Potential borrowers are only required to own a car. The loan company then lends a particular percentage of the vehicle’s total value to the borrower and keeps the title of the car as collateral. Borrowers may be required to pay the loan after a month. A two-year installment plan may also be applicable. Should the borrower default, the car may be repossessed by the lender. Alternatively, the lender may allow the defaulter to make interest-only payments by rolling over until the amount is fully repaid.
The Advantages of an Auto Loan
Perhaps the most outstanding benefit of a car title loan is that a borrower gets the required amount almost instantly. Within a day or two, the loan is processed. The process is usually simple, only involving the lending company to confirm that the car belongs to the borrower and is in good condition. Every car owner is a candidate to an auto title loan because no background checks or credit history checks are involved. Because the lender has zero risk, car title loans have high approval rates. If you have bad credit, your bank may not grant you the loan you need however urgent, but a car title loan lender will, as long as you have a car.
How much do Title Loans Cost?
People in financial strains and those with bad credit find car title loans very attractive. However, if you are not sure about your repayment capability, you might want to pause. On average, the APR of a car title loan may be 300 percent and could be higher than 100 percent interest. Some lenders can charge exorbitant interest rates making it very hard for the borrower to pay. Every borrower must critically review the terms of the loans before signing. The lender should be transparent and disclose the APR and all the fees.
A good car title loan lender offers quick cash, high percentage approval rate, and low rates. If you find yourself in unexpected emergencies, you can take advantage of car title loans. These loans are essential for people with bad credit and those who need money quickly. Since anyone who owns a car is able to get a loan, this might be the best way to secure a quick loan.