Can I Use My Car to Get a Loan?
Are you in need of money right away and wondering “ can I use my car to get a loan? ” There is good news for you. Yes, you can. Car title loans can be the ideal solution for all those people who need to obtain funding immediately, but for some reason or another cannot get a traditional loan from a bank.
Traditional banking or financial institutions can refuse to lend to individuals for a wide array of reasons. Some of the most common reasons include:
- They cannot demonstrate a sufficient ability to repay the loan. This is usually the case for individuals who work and have a regularly scheduled paycheck, but receive a salary that the bank considers low enough that they predict that the client will be unable to pay the amount required of the monthly payments.
- They have not had credit for long enough or have no history with the bank in question. When assessing risks, the bank analyzes the history of its clients over the past twenty-four months. When the client is more recent, the bank will usually deny the loan application until a certain amount of time has passed with the individual remaining a client at the bank.
- They are self-employed and therefore aren’t on an official payroll. Refusal of a loan application is incredibly common among self-employed individuals who do not make a fixed paycheck every month, but have a varying income from month to month. This can be seen in seasonal self-employed persons or specialists who work during harder at particular times during the year.
- They are unemployed. If an individual in unemployed, it is nearly impossible for the bank to consider them viable to approve for a loan. According to banks, unemployment benefits do not provide enough to cover a monthly loan payment.
However, lenders that process loans using a vehicle as collateral, whether a car or a motorcycle, often approve clients of a much wider range of individuals including those that banks themselves reject. Obviously, there are still requirements but they are far less strict than those of banks. These types of loans allow people in need of a loan cope with unexpected expenses.
Understanding how these car title loans work is vital to getting the maximum amount and benefits from your loan. If you own several cars, the lender that processes your loan may offer you a higher amount than if you have only one. Other determining factors include the age of your car, the condition of your car, the mileage on it, and its current market value. All those things determine how much you can borrow in a car title loan. Ensure that your car is in good condition and has all the necessary documentation.
When you get a car title loan, you don’t lose the ownership of your vehicle. As long as you continue to pay the monthly fees established by your contract, you can continue driving your car as usual. This is a great advantage because you are getting the money you would get as if you were selling your car but you get to keep it!
To get a higher valuation of your vehicle, you must pretend you are trying to sell it. If you were selling your car, you would try to make it look as brand new as possible, wouldn’t you? Here are some useful tricks you can use:
- Make sure that your car has been recently washed, both the exterior and the interior.
- Remove all the items inside the car. Check the ashtrays, the glove box, the inside pockets. Ensure that the inside of the car is clean and empty.
- Gather your invoices for check-ups and repairs. Find your maintenance book for your car and give it to the expert who evaluates it.
- Compile important documentation like your registration, title, insurance, bill of sale, etc.