Between loans that are meant for houses, and loans that are only a few hundred or a few thousand dollars, there is a loan for just about every purpose and situation. One of the most versatile loans out there is going to be a title loan. Title loans involve you loaning the title of your car in return for money, typically between several hundred and several thousand dollars. However, a title loan is going to be far different than most other loans out there.
1. They Allow People to Keep Their Cars
Unlike what most people think, a title loan doesn’t take the car away from a family that might need to use it. By technicality, the loan that a family is taking out is placed on the title of the car, rather than the physical car itself. This means that a family who takes out a title loan is going to be able to keep their primary form of transportation throughout the loan duration. For a family that is already struggling financially, this kind of change is something that can be heavily appreciated.
2. They Are Fast, Easy, and Straightforward
Most people dread going to the bank because of how long things tend to take, most traditional loans included. However, title loans are a little bit different. They do not require a considerable amount of paperwork, time, or effort to apply to. Generally, applying for a title loan involves four steps. First things first, a person will have to apply for the title loan. Once the application has been accepted, the lender will want to look at the car itself, see the title of the car, and see some personal identification. Once this has been completed, the lender will decide whether to lend the money, and the process will be completed. As one can imagine, this is considerably less time-consuming than most traditional loans.
3. They Are Accepting of Bad Credit Scores and History
Going along with the idea that applying for a title loan is an easy and straightforward process, it is also a lot more open to accepting people who might not have the best credit score or history. No matter what kind of financial history a person may have, there’s a very good chance that the loan application will be accepted. When it comes down to it, because title loans are generally smaller than most traditional loans, it is much easier to overlook bad credit issues. This allows everyone the opportunity to take out a title loan, if necessary.
4. They Don’t Require Years of Commitment
Most general loans last for years, or potentially decades. This is because they usually handle considerable amounts of money, and the terms for these loans are quite long. Even the “short-term” loans can last for years at a time. If a person is having financial issues, years and decades of commitment won’t help their financial situation. This can be problematic for several reasons. Title loans generally last for about 15 to 30 days, making them a very short commitment that can be done and over within a matter of weeks. However, the terms can often be extended or rolled over if you need more time.