If you’re running short on money and your paycheck is still weeks away, you can avail of various loans to help you out. Having a bad credit score shouldn’t prevent you from obtaining financial help anywhere, especially from private lending companies. A cash title loan (or auto title loan) is a good way for people with bad credit to get the cash they need, without any credit checks.
The Requirements
In order to qualify for cash title loans, you will have to meet any of the following requirements:
- You need to be at least 18 years old.
- You need to have sufficient income, either through employment or through your own business.
- You need to have paid of at least 75% of any outstanding finance on your car.
- You may need to have a duplicate set of car keys (some lenders ask for this).
- You need to be able to demonstrate proof of ownership of the car (this works along with item number 3 above).
Pros of Getting An Auto Title Loan
Car title loans allow bad credit borrowers to obtain fast cash. After the value of the car or vehicle has been determined, the borrower can receive as much as several thousand dollars. Unlike payday loans (for which borrowers can obtain a maximum of 1,000 dollars), car title loans allow people with bad credit to borrow more money.
No credit checks are performed with car title loans. They are essentially secured personal loans taken against your car. As long as you have ownership of the car, you qualify for the loan.
You can still use your car even after taking out an auto title loan. However, should you fail to provide payments or if you default on the loan, the lending company may take away your car.
Cons of Getting Automobile Title Loans
One of the disadvantages of auto title loans is that if you miss out on any of your monthly payments, the lending company may repossess your car and resell it to pay for the cost of the loan.
Fast cash auto title loans usually have high interest rates, with APRs amounting to 300% per annum. Some states have even imposed caps on the interest rates that lending companies can impose on car title loans.
If you are unable to pay your debt or loan, you will have very little choice but to “roll over” or renew your auto title loan. This means you would have to deal with additional fees and interest. Some states have placed a limit on the number of times loans can be renewed though; to better protect borrowers from debt.