A Vehicle Title Loan Is The Easy Way To Raise Funds For Emergency Situation
The current economic situation of the country has affected many people
. Countless citizens who have lost their job have no idea how they are going to pay next month's rent, utility payments, or even buy enough groceries to make it through the month. Or maybe there was no job loss at all. Maybe one of the millions of hard-working Americans who lack health insurance injures themselves or someone in their family becomes ill. Medical bills pile up, adding to the stress of an already highly stressful situation. What are these people to do?
Getting a personal loan at a bank is becoming more and more difficult, and people who would have qualified five years ago wouldn't even come close to qualifying today. Fortunately, however, there are some options when it comes to getting money quickly and legally. A title loan is one such possibility for anyone who owns a vehicle.
Getting a loan on a vehicle title, whether it is a car, truck, RV, or even a motorcycle is a fairly simple process that won't require a lot of time or commitment. The requirements are minimal. A borrower must be over the age of 18 and the actual owner of the vehicle with no liens that will be used as collateral for the loan.
The lender does not take the vehicle, so it can be driven throughout the life of the loan. The lender will either offer a loan amount based on the value of the vehicle or the customer can request a loan amount, as long as it is lower than the maximum amount that the lender is willing to pay.
Typically, title loans can be obtained without a credit check, so personal credit score isn't going to be a factor. Title loans don't require as much paperwork as a standard loan from a bank or credit union, and the amount of time spent at the lender's office will reflect that. The entire process can take as little as fifteen minutes from start to finish. Plus, people are able to get a loan even if they have a lower credit score and do not qualify for a loan at the bank.
The standard length of a title loan is 30 days, though some companies offer monthly payment plans of upwards of five years. If a borrower is unable to pay the loan back plus fees within the 30 day time limit, they do have the option of extending the loan. In this situation, the borrower would be required to pay a loan extension fee. This is very helpful when it takes longer than one month to get caught up on financial matters.
Anyone who is in need of money quickly should consider getting a title loan. Most of the time, someone seeking a title loan will have their money within 30 minutes of walking through the door or picking up the phone. Many title loan companies now allow applications to be filled out over the Internet. No matter how it is completed, a vehicle title loan can ease stress in emergency situations.
A title loan is a short-term, secured loan where collateral is offered in the form of a car or any other titled or registered property such as a home, motorcycle, or yacht. A title signifies an individual's lawful ownership of a particular valued property. For a title to be proven as valid or genuine, it must have first passed all administrative requirements. It should be completely free or clear of all judicial restrictions. For a car, this means that its full payment has already been made.
A lender will hold the title as a representative of the actual property when providing a title loan to a borrower. For a borrower's title loan application to be accepted, the asset being offered as security must be of good value and in good condition; otherwise, it will be rejected. Title loans are good funding sources for people with poor or limited credit score. They are also designed for people who need quick, short-term loans without having to deal with the long loan approval processes of banks. Emergencies, bills and any other urgent expenses can therefore be paid for using title loans.
Title loan interest rates
In spite of the secured or collateral nature of title loans, they are generally offered with higher rates of interest than other credit sources. According to lenders, the reason for this is that the loans are mostly offered to people who already have financial difficulties and therefore carry high chances of defaulting on their loan repayment. The high interest rates are therefore aimed at reducing the risk faced by lenders offering these loans.
Title loan approval process
When approaching a lender for a title loan, you will need to bring along your photo id, car, and its title. The car will then be appraised to determine how much loan you qualify for. On top of verifying your collateral, you lender may also require you to provide proof of employment or any other income source.
Lenders normally do not carry out a background check of a borrower's credit history before approving his or her loan application. They instead rely on the condition and value of the borrower's car to provide adequate security for the loan. As such, the approval process of a title loan application is short and can even be completed in as little as fifteen minutes particularly for small loan amounts such as those less than $100. However, most traditional financial institutions will not approve a title loan below $1000 to borrowers lacking credit history.
Title loan repayment schedule
Once a title loan is approved, a repayment schedule or plan is set, and the loan's interest start to accrue. If a borrower defaults on monthly payments, the lender can repossess and sell the borrower's car to offset the loan balance. However, most states require title loan lenders to hold a borrower's car for 30 days before putting it up for sale in order to give extra time to the borrower to pay the loan balance.
by: John Smithes
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