Car Title Loans: What You Need to Know

Your paid off car can be a source of cash

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There are many different types of loans that people take out these days, some of which are more complicated and time-consuming to arrange than others. For some people, getting a traditional loan is difficult because of their financial status or their credit score. However, if they are in desperate need of money they do have to take steps to get financed one way or another. For some, one possible solution is taking out a car title loan.

Those who are worried about how to get a car title loan needn’t be, as there are many companies that can offer these loans. All you need to do is confirm that you own your vehicle outright and a loan can then be arranged that is secured against the vehicle. As such, you need to make sure you can repay the loan otherwise you risk losing your vehicle. This could make life very difficult if you rely on it to get to work or get around.

Some key points about these loans

One thing to remember about this type of loan is that it is secured against your vehicle, so failing to keep up with the repayments on the loan means you could lose your vehicle. In general, the lender will let you borrow up to 40 percent of the vehicle value although this can vary from lender to lender. So, if you fail to maintain repayments, you stand to lose a lot because you will lose ownership of your vehicle.

One of the reasons why these loans are very popular amongst vehicle owners with damaged credit is that they usually don’t do a credit check, which means that you can get the loan far more easily. In addition, many lenders do not require proof of income from you because they have the security of your vehicle as collateral, which removed the risk for them. Naturally, this is something that appeals to those that have damaged credit or a low income because it means that they are more likely to get the money they need compared to other loan options.

In order to get one of these loans, you will need to get your car valued by the lender and an offer can then be made based on the value of the vehicle. You will generally be offered a loan for a percentage of the vehicle value and you can gain access to the funds pretty much right away, which is another key benefit of this type of loan. For those that need to get money in a hurry, this is an effective means of getting the finance they need without having to wait around.

You should check with the lender whether there are any steps you need to take with regards to the vehicle. For instance, some companies may ask that you leave a spare key to the vehicle with them until the loan is repaid while others require you to have a tracker fitted on the vehicle.

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