Getting the car title loan requires one to walk up to the lenders get their car evaluated and walk away with the loan amount. The whole process may take just a few hours. However, one should exercise great care in dealing with these loans and signing the dotted line because one stands the chance of losing their vehicle in case of non-payment.
Car title loan which is also known as pink slip loan, auto title loan or only title loan are those loans in which an individual can use his car as security toward the loan amount. Borrower passes the title of ownership of his car to the lender for the specific period of time till the amount of loan is paid by him. And as soon as the loan amount is paid by the borrower to the lender then the title of ownership of car is given back to the borrower. However, if the borrower fails to make the payment then the lender has a right to sell the car to fill the debt amount. These are short terms loan with high interest rate from any other credit giving method. There is no need of checking the credit history for lenders before giving the loan they only need to check the value and condition of car before providing the personal loans with bad credit amount to the borrowers.
No credit check loans
Car title loans are extremely popular these days. This can be mainly attributed to the fact that the recession has forced people into financial hardships and there is little that they can avoid these conditions. In fact there are a lot of factors which are beyond the control of individuals and hence they can simply look at the ways in which they can keep themselves afloat and meet all their financial obligations and the needs of the family. People with bad credit can be found everywhere and the rise of the credit repairing agencies and the debt settlement ones can be the obvious reasons for the same.
In such a scenario the no credit check loans offer great relief to people. One can get easy access to funds and can meet their urgent requirements without waiting for the bank approvals and the documentation.
How do these loans help?
These loans pay an important role in borrower’s life of people when they face financial hardship and they have no option of taking loans from anywhere. There are situation when you lose your job and you go to take loans then lenders neglect in giving you loan as they know that you don’t have any job with yourself and you will not be able to pay off the loan amount. Then in such cases you can apply for car title loans from lenders where you can take loan on the equity of your car. Your car will be with you but lender will make a contract with you according to which you have to give your car to them if in case you fail to repay the loan amount and they’ll sell your car to recover the loan amount. You can get any amount of money in these loans but it will depend on the equity of your car and the loan duration will be for less time.
As you know that your car plays an important role in car title loan where companies give loan amount in the equity of your car and then in case you fail to repay the loan amount then your car will be sold to recover the loan amount. Usually every company has different terms and conditions, some charges high interest rate some charges low interest rate. The company who will charge high interest rate will give you benefits of increasing loan terms and easy repayment but the one who will charge less interest rate will act strict in case of default payments.
There are many benefits and drawbacks of these car title loans which you should know before taking car title loans:
It is really important to know every terms and condition of the company from whom you are taking car title loans. All these companies never tell everything correctly to their customers and write false things to attract customers for taking loan from them. It is borrower’s responsibility to understand all the terms and conditions of loans before you enter in contract with them. If you go for online lenders then read all the information of the company which they write in “apply now, about us or FAQ” and then even call the customer support number to know the terms and condition more properly and for clearing your doubts regarding taking loan online.
Advantages of car title loans:
The most important benefit of these car title loans are that the amount of loan is given instantly, there is not much time taken in the processing of loan and a borrower can easily get money if he is in emergency. These loans are better in case of traditional banks, financial institutions as these take much times in processing and the person who need instant cash for some small purpose get stuck in long procedure but in car title loan he get cash within few hours of application.
Anyone can take this car title no credit check payday loans by simply fulfilling some basic requirements like that the borrower should be a owner of a car, he should be of at least 18 year old in age, there should be no other loan in car and he should have a proper identification proof and driving license.
Disadvantages of car title loans:
Because of your poor credit score or no credit history high interest rate is charged on your car title loans and your car is pledged with lenders as collateral against the loan amount and if in case you fail to repay the loan amount your car will be sold by lenders to recover the debt amount.
High processing fees are involved in these loans and if in case the borrower is not able to repay the loan amount on time then he can roll it over the loan duration but he have to pay extremely high additional cost for it and the interest rate will also be increased for the extended duration of loans.
One should exercise great care while taking these loans. Firstly these loans attract very high interest rates and secondly non-payment can lead to the loss of assets under consideration. Not only this but if you fail to repay these loans on time they can feature in your credit report once reported by the credit reporting agencies. The loss of assets like the car is extremely difficult to recover from.
Conclusion: As you are clear with all the details of car title loan with all its advantages and disadvantages then you can now make a proper decision whether you have to take car title loan or not. In case of emergencies these loans are very beneficial as you can get the cash as soon as possible and then you can repay it later when you get money from any other source at once.