What Are Car Title Loans?

Are you curious about car title loans and what they can do to help your financial situation? Often called second-tier loan options, they have become more popular in the past 10 years than ever. To find out more about car title loans, keep reading. At the end of the article, you may find that this is the best solution for your current financial needs.

Defining car title loans

Simply put, a car title loan uses your car as collateral and this means that you own your car with no other loans attached to it.  You can also use your car as collateral if you have just a few payments left. When you complete the paperwork for your loan, you will give them your car title and extra set of keys. One of the advantages of this type of loan is that you are not required to submit to a credit check.  They will verify your income, but the car title is enough to secure the loan.

Interest rates apply to car title loans

The interest for car title loans is built around the expectation that you will repay it within a month to a year.  Each month, a percentage is added to the original loan amount that you must pay.  In general, this is based on the amount that you borrow which is usually up to 50 percent of the value of the vehicle.  These loans have higher interest rates than banks because they do not require credit checks, and that works to the advantage of someone with bad credit.

How laws protect you from bad lenders

In the past, it was easy to get swept away by high interest rates and other fees.  Many borrowers did not understand how loans worked, and did not know to read the fine print.  Today, laws make car title loans safer for borrowers by making the terms clear.  This means you can borrow the money you need without surprises in the future.

Are you ready for a car title loan?

Now that you have a better understanding of what car title loans are and what they can do to help your current financial needs, your next step is to start the simplified paperwork process.  Once you have all of the details written out, you can process the loan with us.  If you still have questions, we are happy to help.  All you need to do is call or visit Bay Area Title Loans today.