Theoretically speaking Title loans
are the short-term loans that are secured by the clear title
to your vehicle or other titled personal property. As a matter
of fact this is a 30-day renewable loan where someone else holds
the title and the keys but you keep the vehicle. In an ideal
scenario you can borrow up to $2,500 on your car title in which
the entire process is fast and easy which usually takes about
20 minutes. However, fact remained that methods differ from
company to company, and the terms may also differ. It is advisable
to shop around to find the best deals.
There is no denying that companies use car titles to secure
the loans. By following this route, if you default on the loan,
the lender gets your car. Point to be noted in this regard is
that most title lenders will only make the loan if you do not
owe anything else on the car for people seeking short-term loans.
Believe it or not Title loans are offered by companies for different
vehicles including cars, trucks, vans, motorcycles, boats and
others. In simple terms an important criterion is that the borrower
should have clear title of the vehicle.
It is worthwhile remembering that Title
loans are usually set up for a period of 30 days. If experts
are to be believed at the end of that corresponding period of
time you can either pay off the loan or you have the option
to pay the minimum interest and extend your loan for another
30 days. There is no hiding the fact that it makes you to extend
as many times as you need to extend. On the other side of the
coin when the loan comes due, you may pay only the interest
to extend the loan, or you may pay off the loan, or pay interest
plus any amount of principal to reduce your next payment.
It is worth mentioning in this regard that Title loan is very
famous among the residents of the UK as a loan for a short term.
Furthermore add to this the instantaneous approval that borrowers
can have, and title loans form the best available option.
Theoretically speaking a title loan is a secured loan with the
title to the automobile serving as the collateral. In other
word the use of automobile as collateral is not limited to title
loans itself. In simple terms m0any lenders accept the automobile
as collateral to back the loan repayment. However, fact remained
that home reigns supreme in the preferred list of collaterals.
On the other hand vehicle or automobile, which is considered
a secondary asset in secured loans, is used specifically to
back title loan repayments.
More often than not the loan provider retains the title to the
vehicle and not the vehicle itself. Because of this simple reason
the borrower thus has the freedom to use the vehicle in the
manner he chooses, provided efforts are made continuously to
keep the vehicle in good condition. In an ideal scenario a basic
prerequisite for the loan is that the borrower must have a clear
title to the loan. In addition the borrower will be required
to provide documents proving the ownership of the automobile
at the time of approval of loans.
On the other hand in regular loans, borrowers have to wait for
several days for the loan to be approved. There is no denying
that Title loans are different. Believe it or not within 30
to 45 minutes of the application, you can find your title loan
application fully processed. Thats, title loans are also used
as instant loans.
If experts are to be believed borrowers who are wearied of the
large number of refusals will find title loans different. It
is worth mentioning in this regard that no credit check is required
for the approval of Title Loans. As a matter of fact bad credit
people will find these loans especially helpful because it is
only in this loan that they will not be treated on dissimilar
terms. Furthermore it is worthwhile remembering that bad credit
scores owing to County Court Judgements, Individual Voluntary
Arrangement, etc. do not count much in the approval process.
Believe it or not Title loans have a sizable positive effect
on the credit status of the borrower.
In an ideal scenario for approval of title loans, a borrower
needs to present his/her pay stub, four personal references,
and a verifiable address proof. In simple terms as soon as these
documents are presented, the loan can be sanctioned for use.
As is mentioned already, Title loans
is a short-term loan. In addition the term of repayment may
be about a month. As is pretty much the case with other short-term
loans, the rate of interest chargeable is very high. In addition
the annual rate percentage counts up to 300% - 900%. In other
word this is an expensively high rate of interest.
Point to be noted in this regard is that inability to pay the
title loan in the month it is due, will require payment along
with interest. On the other hand in the subsequent month, the
borrower will have to pay double the amount that was actually
due, plus the interest for the first month. This is because
of the simple reason that interest in the second month costs
equal to the actual amount.
There is no denying that there is a fear of being trapped in
title loans because of such an expensive rate of interest. For
instance, it is worthwhile remembering that if the borrower
fails to pay the title loan in the specified repayment period
and the following months repayment burden doubles, the borrower
will choose to repay only the interest. This clearly emphasizes
the point that the principal is again carried over to the next
month. Once again, it is worth noting that the borrower will
accrue an interest equal to the principal. As a matter of fact
this becomes a vicious cycle, making it difficult for borrower
to extricate him/her out of the quagmire.
1. best unsecured loans
There is no denying that a steady life is always a dream. Honestly of course, it is worth pointing that a steady...
2. loans education
Theoretically speaking you cannot ignore the fact that the cost of a college education has soared through the ro...
3. loan amortization
In simple terms Amortization is the repayment of a loan. As a matter of fact it is usually used in conjunction w...