3 Tips To Help You Successfully Apply For A Title Loan
Sometimes you need additional money to cover living expenses between paychecks. A traditional loan often has stringent qualification requirements and the loan application can take time to process. If you need cash now, then a title loan might be a better option.
With a title loan, you use your car as collateral to secure the loan. There are no credit checks, so more people can qualify for a title loan. Use these tips to help you successfully apply for a title loan when you need extra cash in the future.
1. Make sure your vehicle qualifies.
Before you spend time filling out an application for a title loan, be sure that your vehicle qualifies as collateral. Each lending company has different parameters when it comes to the vehicles they accept.
Some factors that might exclude your vehicle from being used to help you secure a title loan can include age, high mileage, and poor exterior or interior condition. You can always drive your vehicle to your local title loan lender and have them evaluate the car to determine if it meets their requirements. You will likely be able to receive an estimate on your borrowing limit at that time as well.
2. Choose the right repayment option.
Title loan lenders offer a variety of repayment options for their customers. You can opt to manually submit your payment on the monthly due date, or you can have your title loan lender automatically debit your account when your payment is due.
Some title loan companies can even automatically deduct your payment from your paycheck so that you don't have to worry about overlooking a payment. There are often stiff penalties associated with missing title loan payments, so choose the repayment option that will be easiest for your to adhere to over the life of your title loan.
3. Ask about early repayment penalties.
When you apply for a title loan, a repayment schedule will be generated to help you keep your monthly payments as low as possible. The longer it takes you to repay your title loan, the more you will end up paying in interest.
It's important that you ask about any penalties that may be assessed if you opt to repay your title loan early. Some lenders will charge a fee for early repayment, while others encourage customers to pay off their title loans as quickly as possible. Understanding your early repayment options will help you better budget for your title loan in the future.