Affordable Title Loans
No one plans on opting for a loan, but sometimes, bills need to be paid, and there may be a lack of available funds. Conventional loans aren’t always the most feasible option, especially if you need a large amount of cash in a short period. This is where people opt for title loans, instead.
Title loans (also known as car title loans) are designed to help you fulfill any time-bound, short-term payments and loans. Affordable title loans are ones where you can get a higher loan at an interest rate that is lower than the market average.
Car title loans are typically short term--around 15 to 30 days, and the loan value may vary anywhere between 20-50% of your car’s equity value.
Common Eligibility Requirements for a Title Loan
Although anyone with a vehicle of their own can technically request a title loan, certain requirements need to be met:
- You should be able to provide proof of complete ownership of the vehicle; the vehicle also must be in proper working condition
- You will also need to provide a photo ID and proof of insurance
- Your credit score will also be reviewed
Once your loan request is granted, you will need to sign the provided forms and hand over the car title to the lender to receive the cash. Once you pay off the loan and the additional charge, you can get your title back. The additional charge is generally around 25% or higher.
Do You Have Ownership of Your Car if You Take a Car Title Loan?
Although you transfer your car title to the lender, you still own your vehicle. This means that for the duration before the loan is paid back, the lender will have a security interest in your vehicle.
The lienholder is placed on the car title, and once the loan is paid back, the lender will provide you with documentation that states that the lien has been released. As an extra security measure, many people have a new title issued after the loan has been repaid to show that the lender no longer has any security interest in the vehicle.
You can continue to drive and use your vehicle before the loan has been paid back, but you’ll have to abide by the terms and conditions set in the agreement and make timely payments.
What Do You Do if You Can’t Repay the Loan?
The reason you took the loan in the first place was that you didn’t have the necessary finances in the first place. The chances are that a month later, you might be unable to pay back the loan. In such cases, you can do something known as “rolling over,” which involves refinancing the previous loan.
However, use this option as the very last resort since your monthly fees will go up every time you refinance a personal loan. If this keeps going on for a prolonged period, the lender might repossess your vehicle.