A car title loan is a brief loan with your car as the collateral. You give the lender the power to repossess your car should you fail to repay your loan in time. In addition to this, most of the car title loans have a payback time shorter than 60 days.
Despite having the facts right, very few people understand the financial implications of car title loans. Knowing these before taking your loan will help you plan your moves right, says Utahmoneycenter.com.
They are mostly instant
All car title loan providers will give you the loan instantly. All you need is to provide your logbook and proof of ownership. You can keep on using your car as you look for money to pay back the loan.
Your car will determine your loan
The market value of your car will determine how much you can get as a loan. The lender will always give an amount he or she is sure of recovering once they liquidate your car. Keeping your car in a good shape will give you better odds.
The sooner you pay the better
Most of the lenders will be lenient enough to let the debt roll over to the following month. This, however, comes at an extra cost. Paying your loan as soon as possible will reduce on the charges you incur.
The rates are never the same
Always shop around before taking the loan. Different lenders will offer different rates and terms. You should look for the most lucrative provider who will give you the amount you want at a sensible interest rate.
Auto title loans are a perfect way to sourcing that instant cash you need while your salary is far away. You should however be careful when taking the loan. Always be sure that you can repay the debt in time – unless you don’t mind if your car is repossessed.