For someone who is considering taking a car title loan, you will be required to give the clear title of the car as collateral for the short-term loan. A car title loan is also known by names such as title pledge, pink slip loan, or a title pawn.
One can get a car title loan on the equity of their vehicle and not on the clear title if they don’t have one. One can get this type of loan and payback within a number of days or a month. One must know that these loans have a higher rate of interest compared to other loans.
These loans are not for everyone but they’re for those who can be able to pay back the loans. When one takes this loan, they are required to fill a loan application form, bring the clear title, submit a photo ID, present the vehicle, show proof of insurance and submit a set of keys to the lender.
When one is taking a car title loan, it is important to review the loan terms before signing for the loan. Other charges that one may find when taking a car title loan includes late fees, document fees, processing fees, title charges, liens charges and loan origination fees and all this must be disclosed by the lender. It is important to clarify with a lender whether a loan has an add-on because it could potentially raise the loan amount to be paid back.
People who apply for car title loans must make their applications through an online platform or make physical visits to storefronts that offer car title loans. One must leave their car title with the lender after approval of a car title loan and they will only get it back when the loan is paid off. Repayment of these loans can be done through automated repayment systems, personally visiting the storefront with payment or through an online system.
Lenders may need to repossess a car and this is why they ask borrowers to install GPS devices so that the lenders can always know where the cars are located. For easy repossession of cars, lenders may ask borrowers to install a starter interrupt device which will limit the ability to start the ignition in times of repossessions.
People who cannot make payment within the loan period time may get an additional loan which comes with additional fees and interest, to the amount originally borrowed. If one is unable to repay the loan, the lender will repossess their car. One should really carry out good financial planning if they want to take a car title loan.