Whether To Take A Car Title Loan Or Not
For someone who is considering taking a car title loan, you will be required to give the clear title of the car as collateral for the short-term loan. Title pledge, pink slip loan, or a title pawn are other names that refer to a car title loan.
Other companies offer car title loans based on the equity of the vehicle or the clear title. One can get this type of loan and payback within a number of days or a month. One must know that these loans have a higher rate of interest compared to other loans.
These loans are not for everyone but they’re for those who can be able to pay back the loans. When one takes this loan, they are required to fill a loan application form, bring the clear title, submit a photo ID, present the vehicle, show proof of insurance and submit a set of keys to the lender.
Those who apply for car title loans must review the loan terms before they sign for the loan. Before a client takes a loan, the lender must disclose late fees, document fees, processing fees, title charges, liens charges and loan origination fees so that the client is well informed about all the charges that are part of the loan. Some loans may have add-ons and borrowers must clarify with the lender whether there are such add-ons in one’s loan as this would raise the loan amount.
One can apply for a car loan from an online platform or visit a physical storefront that offers car loans. When a car title loan is approved, one must leave their car title with the lender until the loan is paid off. Repayment of these loans can be done through automated repayment systems, personally visiting the storefront with payment or through an online system.
Lenders may need to repossess a car and this is why they ask borrowers to install GPS devices so that the lenders can always know where the cars are located. For easy repossession of cars, lenders may ask borrowers to install a starter interrupt device which will limit the ability to start the ignition in times of repossessions.
In case one is not able to make payment within the agreed period for the loan, they may get an additional loan which comes with additional fees and interest on the amount that was originally borrowed. If one is unable to repay the loan, the lender will repossess their car. People who want to take out car title loans should have good financial planning so that they will know how they will be able to pay the loan back in good time.