Have you found yourself in a situation where you need cash and will have to get a loan? If so, a title loan may be on your radar to get you the money you need. A title loan is a convenient and fast way to get money, but it helps to understand what these loans are, and how they can work for you. Here are three things you should know about auto title loans services before you get one.
Title Loans Aren't Available In All States
The first thing you want to do is figure out if you're even able to get a title loan. That's because several states do not allow title loans due to their higher interest rates. If your state does allow them, they may be heavily regulated to ensure that interest charges do not exceed the state caps. Even if your state doesn't allow title loans at the moment, know that laws change quite often, and it may change in the future.
You Actually Receive The Money
Some lenders have loans where the purpose is to pay for a specific expense, and the lender handles the money transaction between them and your creditor. Title loans are quite different because you're the one that receives and distributes the money from the loan. This means that there is less scrutiny over what you use the money for, allowing you to use it for whatever you want. You can use a title loan to help buy Christmas gifts, or just use it to pay off a bill that is on its final notice.
The lender that gave you the money for the title loan won't have requirements for you to notify them where the money went. It can be used for private matters that are not shared with the lender, if you wish. Even if you fail to pay the money back, the way that you spent the money will still remain private.
You Don't Need Good Credit
You may think that you must have a good credit score to get a title loan, but that isn't the case since a vehicle is used as collateral. Failing to pay the loan back means that you lose the vehicle, which is something that the lender can easily repossess if needed.
If you're not sure if a title loan is right for you, meet with a local lender for more information.