Questions You Should Ask Before Opting For Auto Title Lending
Auto title lending refers to the financial practice of lending by holding the title of a car as collateral. It is essentially a loan, but the terms and conditions differ. Here the lender places a lien on the car title and can possess the car if the borrower is unable to pay back the loan.
These loans are in general for a short period and do not require a thorough background-credit check of the borrower. As this is a collateral based scenario, the lender can take ownership of the car in case of default.
The procedure to obtain this loan is simpler than the normal loan. You can apply for these loans easily online and will be required to fill forms and confirm your credentials and eligibility. The borrower must himself/herself be the owner of that car, holding the title themselves.
Most lenders will offer you half of the resale value of the car or higher. Depending on the state you live in. For example to get an auto title lending in San Jose all you need is ownership, and clean title of a vehicle and a government issued I.D. You can easily apply for a loan through a company that offers you competitive interest rates and offers satisfactory customer service.
Understanding what the auto title lending is all about is necessary before making any decisions, the idea of getting quick cash to fulfill your need may be tempting, but you need to ask yourself a few questions before you decide to apply for a loan.
Many factors can come into play while making financial decisions, such as your income, will you be traveling? Are the permanently in the said state until the loan is returned? Will you be able to manage your finances after deducting the payable amount?
These are some of the most critical questions as wrongly opting for title loan led you o losing your vehicle. To help you with this decision here is a list of questions you need to ask yourself before opting for an auto title loan
1. Is It Feasible For Me?
You need to decide when it is necessary to get an auto title loan. You need to be sure that there is no other option to fulfill your need for cash. You are likely to lose your means of transportation if you are unable to pay. Find an auto title lending company whose numbers and percentages you are satisfied with. Make sure you are aware of the value of your vehicle before letting the title lending company place a lien on it. Visit multiple title-lending websites before deciding. Talk a professional at one of these services and get an opinion as to whether to need a loan. You can consult one of the professional auto title lenders to help you get an idea.
2. What Is The Actual Amount You Need?
When you need quick cash, title lending can be an attractive option. But, is it worth it? Are you getting more loan than you require or is it lesser than your requirements? In both these cases, it is not feasible to opt for an auto title lending. If the amount you are borrowing is far higher than you need it is likely to dis-balance your financial management and budget. If the borrowing amount is a few hundred dollars above the required amount and you know you can pay it back easily then you can proceed, but an excessive amount can create larger financial problems in the long run.
3. How Urgently Do You Need The Loan?
You might be eligible for other loans as well but is the requirement for the loan is urgent then auto title lending is the way to go. It is the fastest way you can receive your required amount. At most, it will take a day to be transferred to you. If you are in the same area as the auto lending firm, you might even get the loan transferred in an hour.
4. Do You Have All The Necessary Documentation?
To get the auto title loan, you must be in possession of all the required documents. You will need to have a valid driver’s license, a title to your vehicle, your salary slip or other proof of income and proof that you are a resident of that state. These documents are a must to get you the financing you require. If you do not possess any of these, you may be declined by the auto title lender.
5. Is My Vehicle Right For Auto Title Lending?
Almost all cars and other vehicles are suitable for this loan. However, the model, make, and condition will affect the amount of loan you will receive and the interest you will pay. If you own the title of the car and it has already been paid-off, you are sure to get the required loan.
6. What Is The Repayment Time I Can Easily Pay Back In?
Work with your potential lender and decide the terms and period of payback that suits you. The recommended period is generally between 12 to 36 months. It is best to work with your lender to determine the number of installments and the period of payback. If you choose to pay earlier than the determined time you won’t face any penalties.
Before acquiring the loan, you need to understand your position. Determining your lender is the most important decision in this process. Decide to borrow from a lender who has a good reputation and does not hide any facts from you. Do your research, opt for the one who is providing you the best possible customer service and is willing to answer all your queries. The transfer time should also be contemplated in these cases. It is not necessary that the lender offering the quickest transfer is the best, carefully analyze all the factors of the potential lending website before making a decision.