Over 2 million Americans take out title loans and borrow money against their cars annually. Now, there’s a wide array of loans available in the market, and title loans kind of have a bad rap. However, don’t believe everything you hear because there are also excellent benefits of car title loans.
So, what are the benefits of car title loans? Well, this guide explores all the benefits you tend to gain by getting yourself an auto title loan.
Car Title Loans Are Very Easy to Process
One of the most notable benefits is that car title loans are very easy to process if you need money now. Title loans are given to any person who owns a car and possibly a good income stream. Basically, what the lender will do is place a lien on the title of your car.
You have to present the title lender with the hard copies showing ownership of the car. The lender will retain these documents until you completely repay the loan back. Once you pay the loan in full, the lender will give the documents back to you.
Your Credit Score Won’t Matter
One of the most significant benefits of car title loans is that your credit score won’t matter for you to qualify. This is one of the biggest hurdles a lot of people face when getting traditional loans and one you won’t have to contend with. Your car title lender only focuses on the value and condition of the car, and if it’s in good condition, you get the loan.
You may even get a higher amount than you thought possible if you can prove that you have a consistent income flow. This will show the lender that you’re more capable of meeting the stipulated payment installments.
You Can Still Keep and Use the Car
The biggest misconception you may have heard about taking out car title loans is that you won’t be able to use your car. On the contrary, nothing could be further from the truth. You get to keep your car, and you can still use it without any problems from the lender.
The only thing the lender will keep is the car title that they’ll use as collateral. Only when you’re unable to completely repay the loan could the lender repossess your car. Otherwise, if you’re confident that you can easily pay for the loan, then you have nothing to worry about.
Title Loans Are Cheaper Than Cash Advances
If you have considered getting a cash advance, they did it to know that car title loans are much cheaper. With the car as your collateral, you will add a security layer and get a reduced interest rate.
Of course, this does not necessarily mean that the interest rates are low. The rate you get will highly depend on the lender. Make sure you read the terms of the loan and understand the interest rates before you finally agree to sign any papers.
Reduced Financial Stress
It can be very distressing when you have an emergency, and you have no idea where to get sufficient financial aid. One of the best things about car title loans is that they’re fast to process and will help reduce your financial stress considerably.
The loan will also eliminate the stress that comes with borrowing money from relatives, family members, or friends. Even better, you’ll also eliminate the stress that comes with the tedious process of applying for traditional loans.
If the time ever comes that you’re unable to settle the loan, all you have to do is give up your car for the lender to repay themselves. This does not necessarily mean that losing your car is a good thing, but you won’t have to go through the stress of looking for money everywhere just to pay the loan.
You’ll Enjoy Flexible Repayment Terms
Most title lenders will offer you flexible repayment terms based on various factors. You may also be able to ask for a repayment extension if you are unable to get the money during the determined period.
Your car title lender will also allow you to make payments early without having to pay for the prepayment penalty. This makes auto title loans one of the best financing options.
Freedom to Use the Funds as You Please
One of the biggest benefits of car title loans is that you have no limitations on what you can do with the fan. A lot of traditional loans come with restrictions, but with the title loan, you can invest in a business or use it for personal needs. This is an incredible advantage because you may not be able to qualify for some loans without outlining the purpose.
Almost Any Vehicle Can Quality
The next significant benefit of auto title loans is that most vehicles can qualify as long as you can prove it’s in good condition. You can use a truck, an SUV, or even a motorbike to get a car title loan.
Title lenders don’t just consider new or expensive vehicles, although you may qualify for a lower amount if you have an older car. Still, the wide array of options makes it possible for most borrowers to qualify for a title loan.
You Can Build Your Credit Score
Even though a car title lender will not check your credit score, you can use your title loan to build it. When you pay the loan on time, the lender will send the report to credit bureaus, increasing your credit score. The best thing about this is that a high credit rating will make it easy for you to qualify for other types of loans in the future.
Are you looking for a car title loan? Check out this lender in Lawrenceville, GA.
The Benefits Car Title Loans
There you have it! These are some of the most significant benefits of car title loans. If you have been wondering whether it’s a good idea to get one, then this article clearly shows that you’re on the right path.
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