Common Misconceptions About Car Title LoansFast Action Finance
There are many people who may be interested in getting loans of some kind for whatever reason. For instance, if itâ€™s during the middle of the month and you are having a hard time keeping up with the bills, you could opt to take a loan and use it for this, and then use the money you get at the end of the month in order to pay off the loan. One of the most attractive types of loans to use for this is a car title loan. This allows you to get the money using the car title as security. This type of loan might not make sense to many people, which is why some end up making false assumptions about them. Some of the commonest of these include:
That you need to have a good credit rating in order to get the loan
With the majority of other loan types, you need to have a good credit rating in order to either get the loan at all or get it at a reasonable rate. Most people think that this is the same case with the car title loans, and may therefore opt to not apply for them if they donâ€™t have good ratings. However, the truth is that unlike other types of loans, you donâ€™t need to use your credit rating as the security for the loan. The fact that you use the car title means that when getting the loans, the nature of your credit rating does not have an effect on anything to do with the loan, the interest rate included.
That you can get the loan irrespective of your car payment status
One other common misconception that people have is that in order to get the loan using your car title, you donâ€™t have to have completed the payments on the car. However, most title loan companies are structured in such a manner that they will only give you the money once you are fully and legitimately the owner of the car. This means that there have to be no outstanding payments on the car by the time you apply for it.
That you have to clear the loan in a few weeks or months
When you apply for and get a car title loan, you often have at least one year to pay it off, depending on the amount and the agreement you have with the lender. This means that you can make small payments each month, rather than having to get into an endless cycle of having to use all your income to pay off the loan and then get another one because you donâ€™t have money to pay your bills after making the payment.
These are just some of the common misconceptions that people have about these types of loans. When all is said and done, they are a very useful product, especially in tough financial times when most people are broke. The car title loans are an easy to use and pocket friendly alternative to other types of loans including payday loans.