If you have defaulted on loan payments in the past and have poor credit as a result, there is a way that you can rebuild your credit history and score. Having a low credit score can prevent you from being able to find traditional lending options when it comes time to do things like buy a car or house. Lenders will only approve loans to those they believe are good candidates to repay and do so on time. Re-establishing good credit can be difficult, but it is possible. Here is how to use a car title loan to help restore your credit rating.
What Is A Car Title Loan?
If you own a vehicle that is paid off and has a clear title, you are eligible for a car title loan. Title loan companies like Embassy Loans of Florida will allow you to borrow money using your car or truck as collateral. Since the loan is secured by your vehicle, there is no need for all of the paperwork associated with conventional loans. There is no credit check either, since the loan is not based on credit. If the borrower does not pay back the loan, the lender can take possession of the vehicle and sell it to recoup its losses.
How To Obtain A Car Title Loan
The process of obtaining a car title loan is quick and easy. An application is filled out and then applicants must verify their identity and residency. They must also present the car title and verify that it matches the vehicle. Embassy Loans, like other title loan companies, will assess the vehicle for its value. Once that is complete, the final loan agreement can be drawn up. The borrower signs the agreement and receives the money. This process usually only takes between 20 mins to an hour. Many car title loans are approved with borrowers receiving their money in a matter of hours.
Using The Car Title Loan To Pay Off Debt
The proceeds from the loan can be used to pay off other debt. Doing so can help to improve your credit score. Pay off your highest interest debt first and have a plan for paying off the car title loan. Paying off the car title loan also improves your payment history and, ultimately, your credit score. Re-establishing good credit can take time. Using a car title loan is one way to help get the process started.