How Does A Premier Title Loan Work

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Car title loans aren’t for everyone. They come with double digit interest rates and you run the risk of losing your vehicle if you fall behind on payments. That doesn’t mean they’re not a viable option for someone who needs emergency cash. Before you move forward with any finance option you need to fully understand how the loan works. In this case you need to know that with a title loan you’re using your pink slip as collateral. In most cases you can borrow anywhere from 50-75% of the vehicle’s current blue book value. That means a vehicle worth $10,000 that you own outright can get you access to funds of $5,000 to $7,500. By using a vehicle title as collateral you can often get a larger amount of money than what you would see with a typical short term loan.  Additionally, most companies are going to be interested in the vehicle’s equity instead of your credit report or past payment history.  Finance terms for a title loan are much different that what you would expect with an payday loan or cash advance. Much like an installment loan, you can pay off the full amount over a period of months or years. Compare that to a payday advance where the full amount is due within a period of weeks. Most lenders will also allow an early payoff with no pre-payment penalty. This is the ideal outcome when taking out a title loan as you can get your emergency cash and avoid the high interest charges.

Why Go With A Title Loan

As we mention throughout the site, vehicle equity loans aren’t for everyone.  The finance charges are very high and you run the real risk of losing your car if you fall behind on monthly payments. But they make sense in the right situation.  Some applicants may are more inclined to take out a title loan as this type of funding gives them access to more money. Others see a benefit because most lenders put less of an emphasis on the borrower’s credit report.  Compare this to  what’s typical with bank loans and even installment loans. For the most part, the lending company wants to know that there’s enough equity in the vehicle in case of default or repossession. Even though your credit score and borrowing history aren’t critical with this form of borrowing, it’s still important to have good credit.  You should always work to improve your credit history.   we recommend to start with information on how you can improve your three credit bureau score.  This includes major underwriting factors like a FICO score.  Once a consumer brings up their overall credit rating they can move on to other financial options that are less costly.   Online title loans may be an option if you’re looking to borrow a significant sum and your credit is less than good.

What To Look For When

Choosing A Lender

Most borrowers don’t even know where to start when the begin the process of finding a title loan company. Two of the biggest questions are as follows. Do they apply online or in person? How much money are they looking for? Once they settle on those questions they can kick off the process of finding a letter. The first step is to choose a company that’s licensed and regulated to provide title loans in your state. This sounds obvious, but many companies only fund in a handful of states. Some outfits are unlicensed or outright scams so be sure to check that your company has an active lending license. Another factor to consider is what type of reputation your company has with of processing and customer service. You can easily look up this information online and use it to make a better and more informed decision.

Lastly, try to find a company that’s willing to work with you when it comes to financing terms and loan amount. Don’t choose a company that wants to give you more money than you need. They’re only doing this to extract more money from you in future interest charges. Always ask your rep, if they can lower the interest rate and be sure to shop around to get the best terms. It goes without saying, but you want a company that understands things come up. Look up past complaints or comments about your lender to determine if they will help you down the road if you fall behind or need a repayment plan.