What to know about car title loans and how they work

0

212Ready

Get to know what a car title loan is and how it works.

NEW YORK, NEW YORK, USA, July 25, 2021 /EINPresswire.com/ — Need quick cash to pay rent, bills, or take care of emergencies? Then a car title loan could be the answer to your money troubles.

A car title loan is a short-term loan where the borrower uses the title of his car, truck, motorcycle, tractor-trailer or any vehicle as collateral. Simply put, a car title loan is where a borrower gives the lender title to their vehicle in exchange for quick funds. Like payday loans, car title loans usually last 15 to 30 days and you can get up to $10,000 to deal with any unforeseen emergencies you may have.

Car title loans are attractive because they’re quick, don’t require a credit check, have less paperwork, and you can get the money in less than an hour’s walk to the lender’s store. All you have to do is take your car to the lender, get their approval for the loan, give the lender the title to your vehicle, get the money, and pay off the loan on the due date. ‘due date. But before you apply for a car title loan, you need to make sure your vehicle is clean, free of payments, and in good condition. A vehicle with overdue payments or repair issues will reduce your chances of getting the loan.
The exact amount you get from a car title loan is based on the current market value of the vehicle used as collateral. And the loan limit is usually between 25% and 50% of the current market value of your vehicle.

Before getting a car title loan, you should know that there are two types of car title loans – and which one you get depends on the agreement between you and the lender. The types of car title loans available to you are:

1. One-Time Payment Loans: This car title loan requires you to repay the money owed, including the 25% monthly finance charge (interest rate) and other fees all at once after 3o days. Multiple payments are not accepted in this type of car title loan, and borrowers must pay it all in one large sum or risk losing their vehicle.

2. Installment loans: This car title loan allows you to make multiple payments spread over 3-6 months. Most installment loans also have an annual percentage rate (APR) that tells you how much it costs to borrow money for a year. The APR is based on:

• The amount borrowed
• Monthly interest rate
• Term of the loan
• And how much you pay for additional costs.

How it works
Getting a car title loan is very simple because lenders don’t care about proving your source of income or credit score. They only need your car and some documents to show that you are and own the car. Your application can be completed on the lender’s website, but you will need to take your car to the lender’s physical store for document verification and vehicle inspection.

Here’s how a car title loan works:
Step 1: You complete the application form online or at the physical store of the lender.

Step 2: You show the lender your car and other necessary documents like your photo ID and proof of your car title, car insurance and driver’s license.

Step 3: The lender verifies the condition of the vehicle, confirms the documents and approves the loan.

Step 4: You get the money and it retains title to your car

Step 5: You repay the loan plus interest charges after 30 days and regain title to your car.
Additionally, a lender may also require a borrower to install a GPS tracker or device that disables a car’s ignition in the vehicle in the event of a potential repossession. This extra detail is put in place to protect the interests of the lender since there is a higher than average risk of default with this short-term loan.

A real life example of how to get a car title loan
Travis is short on money and can’t pay his daughter’s medical bills. He decides to borrow money from a lender using his vehicle as collateral for a car title loan. He gives the lender the necessary documentation and gets up to 50% loan based on the current market value of his vehicle. He reimburses after 30 days and recovers the title of his vehicle again.

How to find a trusted lender
If you’re looking for a place to find a trusted lender, we suggest you try 212Pawn. 212Pawn is a search site that gives you access to the best lenders in your area. All you have to do is enter your vehicle details and they will connect you with the best lenders.

Now that you know how a car title loan works, why not apply for one and take care of your emergencies!

Mr Ready
212Ready
+1 2122035407
write to us here
Visit us on social media:
Facebook
Twitter
LinkedIn

Share.

Comments are closed.