Wondering how to get a personal loan? If you have poor credit or no credit, you’re probably wondering what your loan options are at this point. A car title loan is a short-term loan in which your vehicle is used as collateral against the loan. Car title loans are traditionally sought out by consumers who can’t qualify for other traditional financing options.
Keep in mind that some states don’t permit car title loans. However, if you are able to apply for a title loan, you will need to bring your car and necessary paperwork to the lender. While some applications are available online, your lender will still need to verify the completeness of the paperwork as well as the condition of your car prior to releasing the funds. The lender will maintain physical possession of the title, place a lien on it, and give you your money.
It’s important to note that, in order to obtain a car title loan, you will need to own the vehicle outright. In other words, there may not be any outstanding leases or loans on the title. Some lenders might require the installation of a GPS tracking device on the car in case you default on the loan and the lender must then repossess the vehicle.
Although car title loans are generally more expensive than traditional loans given out by banks, you don’t need to have perfect or even good credit to obtain a car title loan. In many cases, lenders won’t check your credit at all since the loan solely depends on your car’s resale value.
The bottom line is that the you are a great candidate for a car title loan is someone who understands the likely high cost of the loan, who owns a vehicle outright, and who has a reasonable expectation of being able to repay the loan before the repayment period expires. While there are several factors to keep in mind such as interest rates and terms, the most critical consideration will be your ability to pay off the loan on or before its due date.