What Should You Look for When Comparing Title Loans?
Life is full of surprises, and more often than not those surprises appear in the form of shocks. Being prepared to face those challenges helps to combat these situations.The same rule applies to times of financial difficulties as well. When going through a severe financial rut, you may feel that a quick injection of funds can bail you out of the crisis. From losing jobs to troubled relationships and from medical emergencies to servicing other loans —some extra cash is the only answer to fighting back during the hard times. Quick availability of additional money can alleviate stress and bring back the smile on your face once again!To make it happen, you need to have instant access to some form of cash loan.
Options for quick money – Title Loans
The best option of obtaining quick cash is to look for Title loans. As the name indicates, loans are approved against the title of the car that you own. Lenders use the title of the car as collateral by placing a lien on the car. Since the lender’s interest is completely protected, as they can take over the car in case you default in paying back the loan, they do not mind granting money right away with the minimal scrutiny of your loan application. With the simplest documentation, loans are granted within an hour at companies like Bay Area Title Loans and most within the same day.
The lien is removed once the loan is paid back and the title is back with the owner free from all encumbrances. After getting the loan, you continue to use the vehicle in the same way as you had been doing earlier.
Credit scores are overlooked
Title loans are legal in 27 states of the US and cover the majority of the country. Check the legality of such loan in your state before deciding on it. Since title loans are secured in nature, it is only logical that credit scores are not considered for approving loans. Lenders have no worries if borrowers default in paying back as the loan is completely protected by the value of the car against which the loan has been approved.
Eligibility for Title Loans
To qualify for Title loans, which is also known as pink slip loans in certain areas, the title of the vehicle has to be in your name, and it has to be completely paid off. However, some title loan companies like the Bay Area Title Loans accept borrowers who might have a few due payments. Indeed, you need to have a steady income to qualify for the loan because your ability to pay back is a consideration of lenders. In case you have an existing title loan with another lender and would like to get a fresh loan from a new lender, the old loan can be bought out by the new lender to pave the way for the new loan. If you have misplaced the title, even then you can be considered for a title loan, provided the vehicle is registered in your name.
Loan amount, repayment and period of loan
How important are the age and good health of the car can be realized at the time of taking Title loan? Since the value of loan depends on the value of the vehicle, a newer vehicle stands to qualify you for a higher loan amount. You can receive at least $2600, and higher amounts would depend on the value of your car.30 days is the tenure of Title loans in general, but companies like Bay Area Title Loans that are extremely customer oriented can stretch it up to 24 months. Moreover, there are no foreclosure charges applicable in case you want to pay back the loan early. Repayments are to be done every month according to the payment plan that you have agreed.
Get the best loan
The market of Title loans is quite competitive and shopping around is the only way to get the best deal. Comparing the offers that you receive from different title companies in totality would help you to locate the best offer. Here are some parameters that could drive your decision.
- Interest rates – Title loans carry three figure interest rates and can be as high as 300% APR at least in 18 of the 27 states. The interest rate is linked to the repayment period and could be lower for a longer tenure of the loan. In some states, the interest rates have defined slabs that keep decreasing with higher loan amount as you would find in Arizona.
- Terms and conditions – Read the fine print of the terms and conditions that always has to be in black and white. The finance charges and the interest rate have to be clearly spelled APR would depend upon the loan amount, tenure, interest rate and the charges paid for borrowing. Besides the finance charges, make a note of any other charges, some of which may include the likes of document fees, processing fees, title charges, loan origination fees and lien fees.
- Roll over fees – Some companies charge fees for allowing an extension of the tenure of the loan in case you are unable to pay it off within the specified time.
- Additional plans – Loans can be offered together with some additional plans like roadside service plan that you have to pay. This can push up the cost of credit, and you should negotiate effectively to get rid of it in case you do not find any use for it.
- Payment options – Choose the most convenient payment option like auto debit from your account or online payment.
When comparing title loan offers, always look at the complete picture. Do not get carried away by a single parameter even if it might look to be the best of the lot. How much less you have to pay for the loan without compromising your interests is what you should look for.
Hunt for Tile loans like the ones offered by https://bayareatitleloans.com/ that can turn out to be the cheapest if you take into account the incentives on offer.