How a Car Title Loan Works Reviewed by Momizat on . If you want to borrow money, nearly all lenders will check your credit score. That’s fine for consumers with healthy credit, but if have struggled in recent mon If you want to borrow money, nearly all lenders will check your credit score. That’s fine for consumers with healthy credit, but if have struggled in recent mon Rating: 0
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How a Car Title Loan Works

If you want to borrow money, nearly all lenders will check your credit score. That’s fine for consumers with healthy credit, but if have struggled in recent months or years, then your credit score is low and your chances of securing a loan are also low.

Fortunately, there are innovative ways for people to secure money and without the required credit and background checks. Indeed, if you own a car and have title to it, then that title can be turned into cash. Known as a car title loan, it is a fast and easy way for consumers to get more cash and still drive their car. Here’s how a car title loan works.

1. Find a lender. You can find a cart title loan lender online by searching via Google. There are a number of companies that specialize in this lending process. Some of the steps may be slightly different and the requirements too. In any case keep reading and we’ll explore what you should do.

Car Title Loan Works

2. Examine your title. Owning your car outright means you have control of the title. It must be clear of liens and only have your name on it. If your spouse or other party is listed, the lender may require approval from that person too. You are presenting your car’s title as collateral to cover the loan. So, if you fail to make payments, then the car can be taken by the title holding company.

3. Demonstrate proof of income. You’ll be given money in exchange for the car’s title. That money has to be paid back, therefore the car title company will require you to demonstrate a source of income. Most income sources are jobs, therefore presenting your W2 stubs may be sufficient. However, you may also qualify for a loan if you have a regular government check such as Social Security, disability or a pension explains Title Bucks.

4. Present your banking information. When working with a car title company, your loan will most likely be credited to your account. For instance, if the lender agrees to a $2,400 loan for your vehicle, then that amount will be deposited directly to your account. Therefore, supply the bank with your bank account information, including the bank routing number and the account number to secure funding. The title company may then require automatic repayments from that account to repay the loan.

5. Supply government-approved documentation. A picture ID is necessary to obtain most title loans. Here, you can supply a driver’s license, passport or some other information to verify who you are. In addition, you must be at least 18 years old, what the ID will confirm. Lenders do not provide these types of loans to minors.

Keep This in Mind

Another matter to keep in mind is your current financial status. In other words, if you have filed for bankruptcy or presently in the process of filing for bankruptcy, then you will not qualify for the loan. You must be upfront about your financial situation when conversing with your car title lender.

Now that you know the requirements for obtaining a car title loan, you should keep in mind your plans for how you will use the money and how you will pay the loan back.

Fortunately, the lender does not require you to stipulate the loan’s use. Some people secure these loans to pay off a debt, to buy groceries, to cover a medical emergency or to take a trip. That’s up to you. At the same time, take note of when your first payment is due and plan accordingly. Familiarize yourself with the loan terms and always make your payments on time.

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Muhammad Aamir is an avid learner and online marketing consulting. Including guest blogger, blog posts sailing and link building. Social Profiles: Twitter, Facebook, Google Plus Contact: muhammadaamir2013@gmail.com

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