Things to Know Before Going for a Car Title Loan

Before you decide to go for an auto title loan it is smart to understand all about it, like its advantages, how these titles loan work etc. You should also give a serious thought to what kind of amount you will have to pay back and how you plan to repay the loan. Above, all it is very important that you deal with a lender who is reliable and trustworthy. Click here to know more about vehicle title loans. There are four things you should understand. Let us take a look at them one by one.

How does it Work: After you take the loan, you borrow the amount and use your vehicle’s equity to secure the loan amount. In simple words, the lender gives you money based on the value of the vehicle you are securing the loan with. Qualifying for the car title loan is much easier for this very reason; while other financing options are a bit tricky. These kinds of loan can be very helpful in many situations but you should thoroughly understand every aspect of such loans before you take one.

Understanding the Details: The very first thing that you should realize is that these kinds of loans are certainly not the solution to long-term budget related issues. In most of the cases you need to give back the loan amount with interest in a matter of few weeks or few months; while there are cases when a lender may choose to give you few years to pay back the loan. But, it again has disadvantages that if you take a loan for a longer period you will be paying more interests. So, you will always have to keep doing the math so that you are able to arrange the loan amount as soon as possible so that you pay less interest.

Interest Rates and Repayment Amount: Learn about the interest rate that you are lender is about to charge you after you take a vehicle title loan from him. Remember, the meaning of interest till you pay back all your loan amount . It is nothing but the fee that is charged to you for taking a loan for a certain period of time. You will see this number in the contract that you get into. You have to see to it that you choose a lender who offers less interest rate as that is how you can make sure that you cough out lesser amount over a period of time. The rate of interest directly affects the amount that you pay back on a monthly basis. Another factor that affects the monthly payment amount is the tenure of the loan. As a person who is borrowing the loan, your aim should be to make the interest rate and tenure of the loan as small as possible.

Finding the Right Lender: Choosing the right lender is perhaps the biggest favor you would do to yourself while taking a vehicle auto loan. Understand, that every lender works in a different way from another and each of them offer different customer services. There are many lenders who like to educate the borrowers and are very borrower friendly while there are others who only aim to make money no matter which way.

4 Reasons Why You May Have to Consider an Auto Title Loan

If you are one of those who are considering auto title loan as one of the options, you would definitely want to know why you should choose this. You obviously don’t want go for a loan for purchasing a TV if you bought one few months ago but it is possible that you do have certain good reasons to go for a loan. Mentioned below are some common reasons why you would want to take an auto title loan.

  • Medical Bills: Medicals bills don’t get any cheaper with passing years and Americans are facing the brunt for quite sometime now. An average American citizen ends up spending a good 6.4% of his or her net income on medical bills. So if you are on of those average Americans and earn about $25,000 per annum then you would be spending around $1,600 on medical care alone. If unfortunately you or your family member faces a chronic medical condition, the cost of surgery and medical bills will take the net figure much above $1,600 unless you have a good medical insurance policy in place. As more and more employers are cutting down their employee’s health coverage, it is quite likely that you no more have a decent health cover. This means the money needed for any emergency treatments, and health issues will have to be coughed out by you. In a situation like this, an auto title loan can be a great relief to obtain urgent funds without going through the traditional hassle of lenders.

  • For Paying Utility Bills and Generating Surplus Cash: Even if you are cash-strapped, you cannot do without electricity; if you are one the verge of losing electric supply due to non-payment or there is a similar problem with other utility service then you need desperate cash to get rid of the problem because these are the necessities you just can’t do without. After all, no one enjoys sitting in a dark house, or always have cold food or take shower at a relative’s house. A car title loan can quickly get you the much needed cash. Often the cash comes in hand in a matter of few hours and not days or weeks. This way, you can keep the utilities intact and find enough time to pay back the loan. It will also allow you to generate surplus cash for taking care of other daily needs.

  • Mortgage or Rent Payment: A roof above your head is a basic need in terms of good health, safety and above all, maintaining your quality of your life. If you have reached your mortgage payment deadline without making proper payments, you are heading towards imminent eviction, so paying back the money becomes your number one priority. Something like an auto title loan can be a quick solution to avert a problem like this.

  • Vehicle Repairs: As ironic as it may sound, a loan of this kind can also keep your vehicle in running condition. If your vehicle has a major part replacement problem, which requires a handsome amount that you can’t afford to shell out, a car title loan can be an absolute savior. You don’t want to be travelling around in buses despite owning a beautiful car. In situations like, a quick visit to one of the title lenders can get you just the amount that you need to pay at the repair shop. The amount can be as small as just few hundred dollars, and you can quickly repay it back over next one month.

Auto title loan lenders often concentrate just on the value of your vehicle and don’t go for too much of background check like cross-checking credit scores etc. When it comes to title loans, Orange County has some of the best lenders to offer and customers can hope for loans that are not only approved in just few hours but are also given at extremely reasonable rates.