A payday loan is, as the name suggests, a short-term loan that is provided in return for a post-dated check. That post-dated check is made payable on the date of the borrower’s next payday. The borrower then has the option to pay the loan back in full. Payday loans are normally for smaller amounts – the average is around $500 – and are most often used in an emergency situation. When the rent needs paid and the funds are not available until the next paycheck, a payday loan can help to save the day.
A car title loan is similar to a payday loan in that it is a short-term loan that can be used to access emergency cash. Auto title loans are secured by a vehicle. A borrower must own a vehicle and owe nothing on it. The title must have no liens on it as well. Borrowers can apply for a car title loan through a title loan company, such as Florida’s Embassy Loans. Applicants can apply in person in one of the company’s many branch offices or they can apply online. Filling out an application takes just a few minutes.
The processing of the auto title loan is similar to that of a payday loan. Most car title loans are processed in an hour. Many applicants receive their money on the same day that they filled out their application. A borrower must present the title to the vehicle as well as proof of identification and residency. The lender will verify the borrower’s identity and make sure that the title matches the vehicle.
The vehicle is assessed for value and then the final terms of the loan are drawn up. Typically, a person taking out a car title loan can access more money than someone using a payday loan. The amount of the loan depends upon the value of the vehicle.
Processing the loan is quick because there is no need for any credit checks or background checks that are common with traditional loans. For larger loan amounts and quick processing, a car title loan is a great option.