You may be wondering what are title loans on cars? If your in need of cash and considering taking out a car title loan, then this article will answer a few of your questions. The most significant advantage of receiving a loan against one’s car title is that it allows the borrower to obtain the necessary funds in a very short amount of time. A car title loan in South Gate CA from Quick Title Loans typically gets processed within one or two days. This is due to the fact that the process is straightforward and consists primarily of the lender examining your automobile to determine whether it’s worth the amount that you have to borrow.
What are car title loans?
Title loans on cars are a great way to get some cash super quick without losing your car. Car title loans are available to anyone with a vehicle in their name. This is because neither a credit check nor a background check is conducted on the applicant. Your loan request is going to be approved as a secured loan, which means that the lender will evaluate your application based on the collateral that you will provide.
When there is no collateral involved, but the lender still gives you money on the assumption that you can pay back the principal amount with interest, this type of loan is known as an unsecured loan.
Due to the fact that the lender is exposed to almost little risk, the approval rates for a car title loan in South Gate CA are quite high.
If you have poor credit, car title loans could be the perfect solution for you. If you own a car and need 10 thousand dollars to pay off debt or expenses, you won’t obtain that much from a bank. With a car title loan, you can acquire the money you need.
You are also able to keep the vehicle and continue to use it even though you are still making payments on the loan. This is a great advantage.
You will have to hand over the car’s title as well as the spare key to the lender, although you will keep your driving privileges. Nothing, therefore, will change in your life, and you will receive the money.
What to Consider Before Taking a Car Title Loan
It is a good idea to know exactly what you’re getting into before you take a car title loan in South Gate CA.
Here are essential points to keep in mind before submitting your application:
- Car Title Loans Are Secured Loans
As mentioned earlier, car title loans are secured loans. Loans can be broken down into two primary groups: secured and unsecured loans.
When applying for a secured loan such as a car title loan, the borrower is expected to provide collateral in the form of an object of value. This could refer to a car as in the case of a car title loan. As for unsecured loans, they do not require any kind of collateral to be provided by the borrower. When determining whether or not to lend to you, the lender will normally look at factors such as your credit and the stability of your income.
With loans against collateral, such as a car’s title, there’s a need to hand the lender the title to the asset and fill out the application.
A secured loan is less risky for a lender as it can recover the automobile or any asset provided as collateral should the borrower default the loan. If you don’t plan on losing your car, it is absolutely crucial to pay back the principal amount with the interest.
- The Collateral Must Be of Value
There is no guarantee that you will be approved for the car title loan simply because you own a vehicle. To begin, the automobile must have some value. Your application for a loan will not be approved if the vehicle in question is a lemon or has defects.
It’s important that the worth of the car is greater than the amount of the loan you want to take out. For instance, if you are interested in borrowing $10,000, the value of your vehicle should be between $15,000 and $20,000 or more. In most cases, lenders will provide you with a loan worth up to 80 percent of the value of the vehicle. The second requirement is that you should have a clean ownership title. This designates you as the sole owner of the asset.
- Car Repossession is a Possibility
If you have been approved for the car title loan, but unfortunately, you are unable to repay what you have borrowed, you will have to surrender the car or convert your existing loan into another. It’s possible that this will come with additional costs and a much higher interest rate. When you start the never-ending process of rolling over car title loans, you’ll place yourself in danger of falling into a financial trap.
Getting a Car title loan in South Gate CA
A car title loan can be a great solution if you need cash quickly, and you are absolutely certain that you can pay back the money you’ll borrow.
In such a case, go ahead and take the loan! At Quick Title Loans, we’ve helped thousands of individuals get through a temporary financial crisis. Contact us today to know more about our terms and requirements!