Life can be unpredictable at times; even if you have your finances in order, there comes a time when an unexpected expense pops up, and you are short for cash. Borrowing should be your next option.
But what if you have a poor credit score or your family cannot lend you? Well, no need to go on full panic mode. Here is the good news, you can now get money using your car title as security for your loan.
Car title loans are secured loans, which means that when you are unable to repay your credit, you’ll use your car to the lender. I know this might sound a bit intimidating, but it is a reasonable solution for short term fix.
Here is the great part; car title loans are not limited to just cars only. It covers other types of automotive Sport Utility Vehicles (SUVs), trucks, vans, motorbikes, and boats. Yes, boats, you heard me right.
In this post, we are going to have a detailed and in-depth discussion about everything you need to know about title loans. So, let’s get to it.
How do car title loans work?
Well, it’s quite simple actually and not complicated at all. To secure the loan, you must own the car outright or have equity in the vehicle.
The first thing that you need to do is to reach out to the loan company, engage with the leading agency with your pink slip or the title loan, and apply for your loan. The representatives will begin with the verification of the vehicle details such as model type, manufacturing year, and the general condition of your car.
Alternatively, there is an option of car title loans online. The information provided on the form will help the loan company determine the amount they shall offer you or the resale value of your vehicle.
With auto title loans you don’t require a good credit score
Typically, car loan companies evaluate your vehicle and loan you a certain percentage of its value. Nowadays, some companies will provide you with title loans without background employment or credit checks.
Others will carry out credit checks to determine if you have a steady income that will enable you to finance your loan without problems.
On most occasions, you don’t require an excellent credit score to get car title loans. Additionally, you don’t need to be employed to get the loan. However, there should be evidence of income to meet your scheduled payments.
You can qualify to up to 50 0r 60% of the vehicle’s total resale value. Normally, the agency will ask you to hold on to the title till you repay your loan in full.
After documenting the title of your car, the auto loan agency will approve your loan request, but after a lien is placed on your vehicle. Depending on your principal loan amount, loan duration, and the interest rate, the loan calculator will determine your repayment schedule.
The processing time for car loans is much quicker compared to traditional forms of loan as additional paperwork, and credit checks are eliminated. The loan application can take as little as one hour to be approved.