Why Car Title Loans Have Become a Popular Choice

08:00 AM July 01, 2020

Over recent years, people have been able to turn to all sorts of solutions for their financial needs. Those looking to borrow money will find plenty of options, but not all options are necessarily available to individuals. This is because there are various factors that are taken into consideration when it comes to loans, such as your credit score, income, age, and other key factors. You may find that you are eligible for some type of finance, such as car title loans, but not for others.

If you have damaged credit or a low income, you may find that your options are far more limited. People in this type of situation often struggle to get any form of finance from mainstream lenders, and as such, they have to look at other financial solutions.

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The good news is that there are lots of options available to cater to a variety of circumstances and situations. One of these is a car title loan, and these have gained huge popularity over recent years for a variety of reasons.

How Car Title Loans Work

Car Title Loans

So, what is a car title loan and how does it work? Well, these loans are basically secured loans, and the collateral you use is your vehicle title. The vehicle you use as collateral should be registered to you and it should not still be under finance.

The amount you can borrow by way of a car title loan will depend on the value of the vehicle and the lender you go with. If you go onto Google, you can simply type in “car title loans near me” to find a number of lenders that offer this type of loan. You can then compare the lending levels to find one that suits your needs.

In terms of lending levels, most title loan providers will lend you up to a percentage of the value of your vehicle. So, the more your vehicle is worth, the more you will be able to borrow. These percentages can vary. It is important to compare different providers and what they can offer.

Another thing to remember is that you do not have to surrender your vehicle while you have a title loan outstanding on it. As long you are stick to the terms of the loan, you can continue using and driving your vehicle as you normally would. This is ideal for those who need a vehicle for work or other reasons.

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What are the Benefits of Car Title Loans?

So, what are the benefits of car title loans? There are many benefits that you can look forward to. This goes some way toward explaining the growing popularity of these loans. If you struggle to gain access to mainstream lending this could be a perfect choice for you.

Of course, you need to meet the requirements in relation to owning a vehicle, as outlined above, and the amount you can borrow will depend on the value of your vehicle.

Some of the key benefits you can look forward to with this type of loan are the following.

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Ideal for People with Bad Credit

If you have a bad credit history and a low credit score, you may struggle to get any sort of finance from mainstream lenders. This is because banks and other mainstream lenders put a huge amount of focus on your credit score when they consider your application. If your credit score is not up to scratch, you will be turned down. This can then further negatively impact your credit.

With a title loan, the focus is on the value of the vehicle rather than your credit score. Because you have a form of collateral by way of your vehicle, your credit score is not a big issue. If you have a bad credit history and low credit score, it will not stand in the way of you being able to get a title loan. This is a great choice for people who have damaged credit but who own a vehicle and need to borrow money.

Simple Application Process

Car Title Loans

The application process with some forms of secured finance can be very time-consuming, stressful, and frustrating. It can involve sending numerous documents off, waiting for responses, waiting for ages for the application to be processed, and then waiting once again for the decision. This makes the application process a real chore that many people do not have time for.

With a title loan, you can look forward to a very simple and straightforward process that will not take up too much of your time. In fact, you can complete the whole process from start to finish from the comfort of your home or office. You don’t have to go to a physical branch to sort out any part of your loan. This means you can save time and inconvenience.

Fast Payout

Another of the major benefits you can look forward to with a car title loan is a swift and convenient payout of funds. With some types of borrowing, you seem to be waiting forever simply to get a decision. Once you are approved, you may find yourself waiting yet again for the money to be paid out to you, which is no good if you need the cash in a hurry.

With car title loans from reputable lenders, you won’t have to worry about all of this waiting around and frustration. The money is generally paid out within a short space of time. In some cases, you may even be able to access the money on the same day. This makes it an ideal solution for those who need to borrow money quickly to deal with a financial emergency.

A Simple Solution

As you can see, car title loans can provide a simple borrowing solution for many people, even those who have struggled to get finance in the past. So, if you want easy access to a loan and you own a vehicle, this could be the right choice for you.

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