A car title loan can be a superb tool for getting through a financial rough patch. Is it right for you, however? Are you ready to take a title loan just because you own a car and may qualify for the cash? These six tips will reveal the answer:
1. Wait if It’s not Essential to Life
A title loan may be easy for you to obtain, but that doesn’t mean that it is necessarily good for you. Consider your purpose for wanting to take a loan, and reconsider if the reason is not vital to your livelihood. Paying the heating bill in the dead of winter is a good reason to take a loan. Buying a newly released cellphone because you think it’s cool is not a life-essential task.
2. Count Your Blessings
The concept of the title loan can be so appealing that applicants sometimes forget one important factor to consider: their finances. You need to know if you have the monies to pay back this loan, so you have to conduct some calculations. One such calculation is the basic equation that lets you know how much “free money” you have each month after you pay your bills. Take your total monthly income and subtract your total monthly bills. The equation is basic, but it will tell you exactly what you need to apply for the title loan.
3. Make Sure You Have Enough Time
Title lenders can provide you with the funds you need rather quickly. Many lenders boast that they can get your funds to you within a few hours, or at least, the same day. The problem arises when those same lenders expect you to return the funds to them in about 30 days or four weeks. You need to consider carefully whether or not you can return the funds that quickly. If you don’t think you can repay the loan that quickly, then you can consider a different type of cash advance such as an installment loan.
4. Know Your Level of Interest
The interest rate is a sensitive subject when it comes to loans of any kind. They can truly make you or break you. Therefore, you must consider the highest interest rate that you are willing to pay and refuse to go over it.
5. Take Your Sweet Time Researching Providers
It would be very wise for you to research at least three providers before you make a decision to work with a specific provider. Research five companies if you get a chance, but three is ideal. Examine details such as the qualification criteria, consumer reviews, star ratings, Better Business Bureau scores and the like. Do not rush through the process. If you take your time, you will surely find a lender that is a good fit for you rather than a lender that is completely wrong.
6. Read Your Contract Thoroughly
Read your contract thoroughly if you get to the part where you are getting ready to take a loan for yourself. Make sure that you know the interest rate, repayment date, late payment terms and any other information that you need to know to ensure that your borrowing experience is smooth. Your contract with the lender is not valid until you place your signature on it, so you do not have to worry about that in the least. Put the breaks on the deal if it does not seem as if it is a kosher situation for you.
You should be able to tell if you are ready for a title loan by your answers to the six tips. If you are not ready, do not take the loan. Try to find your funds another way. Go for it if you are prepared.