In this situation, many people struggle to make a living, to earn money, and pay the debts. Some of the financial instruments people try are title loans. We have missed reviews about this type of loan, and one favorite loan is a car title loan. Some media portray these loans in a negative review, but in fact, some reviews show positive sites of this. People are saved from financial difficulties when having those
With these mixed reviews, it might be hard to see our stand on this loan, whether it is good or bad. Thus, we’ve listed the advantages and the disadvantages of car title loans that you can follow to see if this loan truly helps you or not.
Disadvantages of Title Loans
There are several cons you may experience when applying for a car title loan. And one of them is that you use your car as security for the loan. Thus, if you cannot pay the money, then you will miss your car. Or your car will be repossessed by the lenders’ company.
You also have to be careful since the loan has a high-interest rate compared to other traditional loans like mortgages, car loans, or personal loans. The interest rate is up to 100%. The car title loan is supposed to be a short-term financial solution. That’s why they have a high rate of interest. Yet, to lower the interest, try to repay the loan early.
Another disadvantage is that your lenders will place a lien on your car’s title. You will find out that the lien is recorded at your vehicle’s administration. This makes you unable to get other loans for vehicles unless you pay for the car title loan.
The Advantages of Title Loans
Most people choose to have this type of loan because of its fast approval. If you need money in a fast way, applying for a car title loan will be the best choice. In most conditions, what you need to do is just filling an application, and get the money compared to other types of loans. Yet, the loan is of course less than the real value of the car.
Another advantage is fewer credit checks. This title loan is much easier, because of its fewer requirements. Some lenders will check their borrower’s credit to see if they are eligible for that loan from the lending company. Yet, some lenders are too lazy to check your credit history, even if they accept you if you have a bad credit history. You can apply it online. Today, there are hundreds of companies or lenders that give you more convenient services. So that you don’t have to go to their locations and finish the loan process. What you have to do is just sit, and fill the online forms from your mobile phone or a computer.