Title Loans: What You Need To Know Before You Apply

10 May 2016
 Categories: Finance & Money, Blog

Have you recently found yourself in a financial bind and in the need of some quick cash? No matter how much you need, a title loan may be a feasible option for you if you own a vehicle. However, before you jump into your vehicle and head to the nearest location that offers title loans, you need to do your research to find out if a title loan is even right for you in your current situation. How much do you know about title loans? Here are some of the basics:

You Must Own the Vehicle – Free and Clear.

In order to apply for a title loan, you must be the owner of the vehicle of which you are using to apply for the loan. In addition, the title must be free and clear. This means that there cannot be any outstanding loans on the loan or liens against the vehicle.

You Will Still Use the Vehicle During the Loan Period But There Are Stipulations.

When you sign the loan papers, you will get to keep your car. However, you will not get to keep your title. You will sign the title over to the title loan company and they will have a lien on your vehicle until you pay your title loan back in full. They will also likely request a key to your vehicle. This is in the event that they need to repossess your vehicle for non-payment. Once you have paid the loan back in full, the lien will be removed and the title will be yours again.

You Usually Have to Pay Within 30 Days, But You Can Refinance.

Each state and company is different. However, like payday loans, the repayment terms are very short with title loans. As a general rule, you have 30 days to pay back your loan with interest. Depending on the title loan company you choose to do business with, you may be able to pay the interest that is due and refinance the loan to allow yourself more time to come up with the money to pay the loan back in full. There will, of course, be a new interest fee due at the end of the new loan period.

To learn even more, contact a title loan company in your local area. Don't sign anything until you fully understand what you're getting yourself into, including local regulations and the company's specific stipulations on loan defaults and repossessions. To find out more, speak with a business like Nekoosa Cash Advance LLC.