Unlike other kinds of financing option, car title loans do not have the complicated and lengthy approval process. As you are offering one kind of collateral, the car loans are simple to qualify, even though you do not have best credit score. Actually, most of the lenders can provide title loans without even checking your score and report. Providing you will show you have the reliable income source, and car is worth more than loan you’re requesting, generally the lender may approve your application. Without wasting any time, let us check out some pros and cons of car title loans:
- Car title loans are an excellent choice if you want immediate money.
- Once you and your lender agree on the loan amount, you will get your cash immediately. In most of the cases, you will walk out of your lender’s office with money in hand once apply for a title loan.
- As lender places lien on a car’s title and does not keep the car itself, you may continue using the car when making payments on a loan. You might not use the car only when you default on your loan & lender repossesses the car.
- One biggest downsides of title loan is short repayment time, very high interest rates & potential loss of car once you default.
These are the short-term car loans with tight repayment cycles. If you cannot pay back this loan when it is due, it will be rolled over in another cycle with higher fees. This creates the tough situation for the people who are struggling to repay the amount.