All you need to know about title loans
A title loan which is also called a car loan is a type of soft loan that you get online using the value of your car as collateral. Online title loans depend on some factors like; the lender and his criteria, the law guiding the giving of loans in your stat, etc.
In most cases, borrowers allow the lender to place a lien on the vehicle title after which it is removed when the conditions of the loan are satisfied and fully paid back, then the car titled will be restored back to the owner. If there happens to be a breach in the agreement on the loan, the lender may take possession of the vehicle; sell it to pay the borrower’s debt.
The duration of this type of loan is usually short and the interest rate is higher than other types of loans. The advantage is that it does not take a long period of time or undue process to get an online title loan. This is because; your credit record is not needed and cannot hinder you from getting the loan. What is most important is the value of your car.
You can get loan amount as little as a hundred dollars to one thousand dollars. Meanwhile, some creditors do not borrow as they feel this is too risky and does not have enough profit.
Below are some typical processes to acquiring online title loans:
- Look for your car title: fir this, you will definitely need a clear and free title. It must not have been possessed before.
- Complete and submit the application online: the next step is to electronically submit the necessary requirements which usually are a photo ID or any other acceptable means of identification, proof that you have a source of income, the loan application, addresses and insurance if any. Some lenders will check your credit history while others will not bother to since it does not really affect your ability to pay back.
- Allow the lender to appraise your car and application: before the money is eventually given to you, the lender will need to evaluate the worth of your car and that of your application. He would not want to run at a loss with the business. All this requires of you is a little patience as it in most cases does not take time.
- Seal the deal: if and when the loan application is approved, you will be required to electronically sign the contract and hand over the title of your car to the lender.
- You can have your money: once all of the above requirements have been met, you can find your way to the bank because you now have absolutely unhindered access to your loan.
- You should be aware that there are some risks to taking online title loan, here are some of them:
- They are expensive: the interest rate on this type of loan is higher than any other type. You can end up paying as much as $1200 on a $1000 loan!
- You might lose your car if you breach the agreement, i.e., not paying back as at when due.
- It might be difficult to totally avoid being cheated.
Before taking an online title loan, ensure you properly vet the ingenuity of the lender you are about to do business with. Also, it won’t be a bad idea to have witnesses on both sides and properly document the loan to avoid being cheated.
As much as you can, avoid taking heavy loans that can cost you your property. I wish you the very best. If you wish to know more about online loans and how to access them, kindly visit this link: title loans.