Life happens. There are many situations that will place you in a vulnerable position. For example, when you have a medical emergency in your household, your instinct is to respond quickly and find the nearest hospital. In such cases, you also need to think about the cost of treatment as this is an emergency you cannot postpone.
For many people who have bad credit, borrowing from a bank is out of the question. Also, it can be challenging to secure funds through friends, so the best place to find quick money is from a lender who does not check your credit rating. If you have a vehicle, car title loans are the perfect solution to your needs.
Many companies will approve applications for money ranging from $200 to $5000 or more. This amount depends on your vehicle’s condition and value. The loan’s payment terms are negotiable, so you can agree on a schedule that does not strain you financially.
You can continue to enjoy the same convenience as before despite paying installments every month. Besides, if you have a good lender, you can pay early without worrying about any penalties. If you’re considering a title loan for your financial needs, here is every question answered.
A Car Title Loan Explained
A car title loan, often called title pawns, is a secured loan where the borrower uses their vehicle as collateral. Unlike traditional lenders, online car title loan providers don’t require good credit from borrowers to approve a loan request. The vehicle offers protection, so the company will repossess the car to recover money if you default. One highlight about online title loans is that they are quick and help you when you need cash urgently.
Typically, a borrower will submit their request in the morning and can get the money before the end of the day. This fast approval and release of funds make online title loans suited for emergencies.
Although there are similarities with other short-term credits like payday and installment loans, title loans require collateral (the vehicle). Because it is secured, you expect to get a higher amount, and the interest rate is lower. And if you have several cars, you can apply for more than one loan, each for a different vehicle.
How Online Title Loans Work
When you need an auto title loan, you can apply online through a simple process. On the lender’s website, you’ll find an online loan application form. Fill it out with all the required information, then submit it. The lending organization will receive the request and get back in minutes informing you of the decision. When they approve your application, you give your car title to secure the deal. The money is released to you in about 24 hours.
There are two types of title loans: a single payment and an installment title loan. The former requires you to repay in a lump sum, usually after 30 days. It offers an average APR of 300%. The latter allows you to make several payments, in three to six months, and they come with an APR of 259% on average.
There are many reasons people turn to online title loans. If you’re facing any of the following problems, you could benefit from getting an instant online title loan.
What Is the Cost of Getting a Title Loan?
Like any credit, a title loan comes with some cost, namely interest. Typically, borrowers pay a percentage of the principal as interest every month. This amount can vary based on different conditions, including your vehicle’s value and the loan terms. You can use a loan calculator online to understand the financial obligations you’ll be taking on.
What Is the Average Interest on Auto Title Loans?
On average, online direct lenders charge up to 25% of the loan amount. For instance, if you borrow $800 with a finance charge of 25%, and your loan is due in a month, the annual percentage rate (APR) amounts to 304%. That is an interest of $200 every month. Interest can vary depending on the vehicle’s value and your loan terms. This is why you need to figure out the costs associated with the deal before you apply. Also, ensure you get an amount you can repay as failure could see your car repossessed.
How Much Can I Get for a Title Loan on My Car?
When calculating the amount you can get for a loan on your car, car title loan lending agencies use a percentage system. First, the company will inspect your vehicle to find its value. Depending on its condition, model, and year of manufacture, you can get from $200 to $5000 or more.
Usually, lenders calculate the amount as a percentage of the car’s value. You’ll often get 25% to 50% of the vehicle’s value, so if it is in good condition, you’ll qualify for a considerable amount. For example, if it is valued at $10,000, you can get a maximum loan of $2500 to $5000. Keep your car maintained, as you never know when you’ll need it to apply for a quick loan.
With title loans online, you can attach different types of vehicles as collateral, including cars, vans, motorcycles, limousines, trailers, and titled boats. The amount you get from any of these depends on the state you live in, as some put a limit on the maximum amount you can obtain from car title loans online.
Eligibility Requirements for Car Title Loans
Besides having a vehicle in perfect condition, you cannot get a title loan online if you don’t meet certain minimum conditions. These may vary depending on the state, so confirm before you start the process.
Generally, auto title loans require:
How to Apply for a Title Loan Online
You need a few steps to get a title loan online. The process is straightforward and can be done on your mobile device or PC at home.
- Decide How Much You Need
- Fill the Online Form
- Get Your Car Inspected
- Get a Lending Decision
- Receive Money
- Repay Over Time
Before you apply for a loan online, the first thing is to decide if it’s right for you. Check if your reason needs a loan considering the cost of the deal. Also, ensure you’re confident you can pay it without default.
Like online payday loans, you need to go online to apply for a title loan. You begin the process by filling an online loan application form, which asks for your information, including bank details, contact information, and other documents. Submit it and wait for feedback.
You then need to deliver your vehicle to a lender’s location for inspection. For bad credit title loans, the amount you’re eligible to get is based on your vehicle’s value. The inspection takes less than half an hour, and you can drive home in your car.
Once the application is reviewed, you will get a lending decision. Thus, you’ll know how much you’re eligible to get. If your vehicle is in good condition, you will easily receive the amount you need. Once your request is approved, the provider begins the process of transferring funds to your account.
Finally, you’ll receive the money in your bank account. The entire procedure will take less than 24 hours. With some companies, you can receive the money on the same day. This is possible if you submit your application early in the day and then contact the lender to ask for speedy disbursement.
Lastly, you must honor the repayment agreement. Once the loan is paid in full, the lien on the car’s title will be released.
How Long Does It Take to Get Money From a Title Loan?
Usually, approval takes about an hour. Depending on the lender, you can receive the money on the same day or the next business day. Title loans offer quick feedback and fast disbursement, making them a perfect solution for addressing emergencies.
While it takes quick approval for title loans, you also need to understand the risks associated. If you fail to pay as agreed, you might lose your car. Ensure you apply for an amount you can repay effortlessly to avoid losing your vehicle. Also, it may lead to a debt cycle as the loan allows you quick access to cash. Many people renew their title loans multiple times, incurring fees.
Where Can I Get Car Title Loans?
There are many places you can find title loans online. MaxLoan is one of the best lending agencies and offers a network of direct lenders in all states. You can always get a loan near you through the company, and their approval process is quick.
Can I Use the Same Car for Multiple Title Loans?
The quick answer is no. It’s not possible to have more than one loan on the same vehicle at the same time. To get a loan, the car must not have any lien. If you want to have multiple title loans, you can do so by using another vehicle. This is easy for people who own several vehicles with clear titles. However, you still need to ensure you can afford the amount as it’s possible to get overwhelmed by the debt and lose your car.
Can I Get a Title Loan While Paying on My Car?
Depending on the state you live in, you could find direct lenders who offer second lien loans. If you’re still making payments and have equity in the car, you could get your application approved. Check for the bylaws in your state and check with different lenders to see if this is an option you can find.
How to Repay a Title Loan Fast
Quickly paying your loan off allows you to get out of debt and avoid making interest payments for a long time. There are several solutions you could embrace to clear the loan, including strict budgeting and making a sacrifice in your expenses. The surplus money you get could go into repaying the debt, which will speed the process up. Because there are no prepayment penalties, you can repay in a lump sum if the provider agrees. If you find a loan with a lower interest, you could consolidate the title loan.
Benefits of Using MaxLoan to Apply for a Title Loan
There are several things that make MaxLoan one of the best lending agencies. They offer quick approvals, their rates are affordable, and you can negotiate a suitable repayment plan. Their system is also secure and ensures the privacy of any data you share while applying for the loan.