Car title loans are an easy way to borrow money in the short term. While most believe that car title loans are very costly, that is not always the case. To qualify for an auto title loan, an individual must own a vehicle, preferably paid off in full, have a clear title, and be willing to offer the vehicle as collateral. In many cases, a car title loan is a best-case scenario for a short-term loan.
How a Car Title Loan Works
As stated, it’s best if an individual owns a car outright. There are instances where lenders will complete a car title loan for borrowers even though there is still a car loan on the vehicle. The car owner must have equity in the vehicle to borrow against it. The entire loan process begins by filling out an application. At Embassy Loans, completing an application takes just a few minutes. Once finished, Embassy Loans, which has helped tens of thousands of customers, will verify an applicant’s identity and check the title to the vehicle.
The next step in the process is to assess the vehicle for its value. Embassy Loans uses typical blue book values to determine how much a borrower’s car is worth. The value of the car or truck determines how much you can borrow. Typically, you can borrow an amount equal to 50 percent of the vehicle’s value. Once the valuation is complete, a borrower can get his or her money. This entire process completes in as little as an hour.
Benefits of Car Title Loans
The big advantage is how quickly an individual can obtain a car title loan. There are instances at Embassy Loans where a car title loan can be completed on the same day that of the application. Car title loans are also ideal for those who have poor credit. Since the collateral is present (in the form of a vehicle), there is no need to review a borrower’s credit history. Borrowers also maintain possession of their vehicles while they repay the loan. Loans are typically paid off within 12 to 14 months, and Embassy Loans caps interest rates. Borrowers can also pay off their loan early without a prepayment penalty. In many cases, car title loans are the only option for individuals needing access to quick cash. In the end, a car title loan provides needed funds in a time of emergency, justifying the cost.