Car title loans provide fast cash to meet your emergency needs; whether its hospital bills or just any random expenses. It offers quick approval and less stringent requirements.
The constant rejections of loan applications by banks and financial institutions had made people start looking for alternative loan sources, and car title loans fit perfectly. Read these great tips to get the best deal on a car title loan.
How Car Title Loans Work
To obtain an auto loan, you have to pledge your car as collateral by handing its title to the lender until your loan is fully repaid. It’s easier to get a car title loan if your vehicle is completely paid off.
Most auto loan firms offer online loan approval. They have platforms where you can quickly determine the loan amount you can get for your car title.
A bad credit title loan is an excellent choice for people with a poor credit history, as lenders rarely consider your score when approving a loan. The loan amount you get is dependent on the value of your car and your ability to repay the loan.
If you fail to repay this loan, you face the risk of losing your car. The lender may give you another month to make the payment, after which your vehicle can be repossessed. This makes it vital to repay the loan when due.
Tips to Getting the Best Auto Title Loan Deal
Getting a car title loan is easy; however, it may be a little complex if you’re a first-time borrower. The tips listed below will help you get the best deal on a car title loan.
Third Party Referrals
If it is your first time of applying for a car title loan, then you should consider asking those around you (family and friends) about their experiences with lenders who offer this loan type. Ask them to recommend any lender who may be of help. Also, look up the internet for reviews on various lenders. Make a list of the lenders that people talk about positively and those recommended.
Do Background Research on the Lenders
After making a list of various lenders, you need to verify the information you have before making a decision. Confirm the existence of such firms at the local or state offices; that way, you will be able to know which lender is licensed to operate such services in your area. The regulations vary amongst states, and you may not be able to get the loan if the lender isn’t approved to offer auto title loans in your state.
Are They Reliable?
It’s essential to check the reputation of a lender. How long has it been in business? How fast are their services? What are the requirements and loan approval rates? All this information will help you trim down your list to a few best lenders.
Compare Their Offers
You need to weigh the terms from various lenders. What are their interest rates? Look out for the lender offering the lowest rates. Having lower interest rates will reduce the monthly repayment amount.
If you are looking to get the maximum amount on a loan, then you should also identify a firm that can offer you the highest amount on your car title. Otherwise, you can choose any lender, provided they approve the amount you want.
Is There a Penalty for Early Payment or Any Other Charges?
Your interest rate starts counting the moment you collect your auto title loan. If you have other income sources that may allow you to offset the loan earlier, then you should confirm that the lender won’t penalize you for making early payments. You should also ask if there are other fees or charges you would have to pay for the loan. Choose a lender with zero or fewer costs.
Compare the Application Process
The loan application process differs amongst lenders. While some lenders allow for online applications, others require that you visit their branch physically with your car to complete the process. Look through the process and the documents needed for each lender and choose what suits you best.
Ask for Available Repayment Options
Don’t be lost in the euphoria of wanting to get a loan to forget that you will need to pay it back. It’s critical you ask for the monthly repayment amount and how it will be collected. Also, find out the available loan term. Have in mind that like any other loan, the longer the length of the term, the higher the rates you may have to pay on interest.
Compare the repayment plan and choose a company that offers you a more flexible repayment plan. Also, make your loan period as short as possible.
Ask for the Kind of Car the Lender Accepts
Most lenders only accept cars manufactured from a specific date. Some may only accept vehicle models from 2010 and newer, while others may accept cars made in the ’90s. Ensure your car model is within the range of the lender you choose.
Can You Keep Using Your Car?
It is not unusual for lenders to ask borrowers to stop using the vehicle until the loan is repaid. Some may go as far as asking you to keep the car with them.
It’s essential to confirm that you can keep and use your car during the loan process before signing the deal.
A car title loan comes in handy when in financial difficulty with no other option of obtaining money. However, you shouldn’t just agree to any deal that you get. Follow the listed tips to get the best deal. It is also essential to repay your loan as scheduled as you stand the risk of losing your car
