Auto title loans have gained more popularity in current times due to their ability to bring fast cash. This is because you are able to get quick money with these loans as the loans are processed quickly therefore there are no delays. Auto title loans are types of loans given in exchange of the clear title of your automobile. The title should not have any lien if your loan would be approved by the lender. It is a short term loan that must be paid as scheduled else the borrower stands a risk of losing his car.
In addition to generating fast cash, it also requires that you fill a few documents to obtain the loan. The lender is hardly concerned with you having a good credit history to access these loans; this means that a poor credit score is not a problem. This is simply because the amount of loan given to you depends on the value and condition of your car. To obtain the loan, the only necessary things that you are required to present are your driving license and documents to prove that the car belongs to you.
Another advantage of these loans is that you get to keep the car and still drive it even while paying off the loan. Although, you are to give a spare of your car keys and the auto title to the lender, you will be able to keep your car. This means that things don’t have to go sideways after you have taken the loan.
While these loans have the highlighted benefits, they are also associated with a fair share of disadvantages. One of the disadvantages is that you may risk losing your car as the lender may repossess it when you fail to pay back the loan.
The good side to this is lenders are people that you can talk to; so, if you find that you can’t pay the loan within the stipulated time, you only need to reach out to the lender and talk to him/her to reach an agreement as to when you can to pay the loan. Many people think that cutting communication with the lender is better when they realize that they can’t pay the loan within the given time which often leads to them losing their valued car. To ensure that you don’t lose your car, communicating with the lender is proper.
Another disadvantage with these loans is that you can only borrow what your car is worth. This means that if you have an old car of low value, you will be given a loan corresponding to its value. For you to get a big loan, you must have a new car whose value is high.
While there are a good number of risks involved with auto title loans, they are great ways of getting fast cash. To make sure that you don’t lose your car, you must ensure that you can pay off the loan. You should also maintain active communication with the lender.