In the process of applying for a loan, a special contract is drawn up, under which the borrower provides the lender with a pledge in the form of any property.
The contract reflects such parameters as cost, location, the term of transfer of property, and more. In this case, the lender has the right to sell the collateral if the loan was not repaid or was not fully implemented.
Moreover, the repayment includes not only the amount of the loan but also interest on its use, as well as other penalties and commissions, if any, were provided for by the loan agreement.
Auto title loans are of great popularity in the US. But what are the pros and cons of this type of loan and where can i get a title loan?
5 Best Car Title Loans
Max Cash Loan Center is one of the best car title loan companies owned by a family of businessmen.
Their target audience is mainly people from Northern Arizona, whom an expert team has been providing fast auto title loans since 2002.
Their primary function is to write short-term Car/Auto Title Loans and Registration Loans.
The process of applying for a title pawn is very simple and actually instant: you register in the MaxCash system, fill out an online application form and wait a couple of minutes while the system checks your application. After completing the verification, you only have to confirm the loan conditions, and the amount is automatically transferred to your Visa or MasterCard payment card. Without income statements, sureties. In case you want to get a title loan collateral is required.
Often money is needed urgently. And you, for example, do not have time to travel to the bank, the preparation of all necessary documents and a long wait for a decision.
In this case, Check city may come in handy. This corporate enters the list of US most reputable title loan companies, which ensures that your title loan will be safe and legit.
The decision will be made in just a few minutes after filling out an online loan application, after which the funds will be automatically transferred to your payment card.
To use Check city services, you do not need to go anywhere. It is enough to have a computer or tablet with Internet access at hand.
Check city fully comply with all regulatory requirements for the size of the authorized capital, equity, and risk management that are presented to financial institutions by the National Commission for State Regulation of Financial Services Markets.
Knowing your needs, Check city have developed the largest list of services among online lending services – from loans for 1-30 days to loans for 1-12 months. You will receive any of car title loans online, without paper documents, long queues, and days off.
The company’s non-official motto is “You turn – we help you. Always.”
Check into cash
Check into cash is the US trademark. They offer individuals a full range of online lending services as well as the best title loans, from issuing to repaying a loan.
You do not need to spend time on a visit to the office of the company, fill out a bunch of documents, and wait for a solution.
How to get a title loan with Check into cash? You only need to register on the company’s website and fill out an electronic application form.
A decision regarding your application will be made immediately. And you can apply for a loan and receive funds around the clock, on weekends and holidays.
The borrower who can get a loan in the Check into cash system is a citizen of the US aged 18 to 65, who has an Identification number, a permanent registration address in USA, a mobile phone number, email, and payment Visa or MasterCard of any bank.
The distinctive feature of this service is that they do not try to impose their services on you. Your decision on obtaining car title loans on the card must be balanced and informed. Before taking a credit via this service, the borrower must carefully consider his options for auto loan refinancing and repaying other online loans in the future.
Traditional Media Group
Tradition Media Group (TMG) provides cheap title loans. It is an agency that uses a large network of borrowers throughout the country to handle title loan products. The range of areas they tend to cover includes even processing and customer sales fulfillment.
Here is the list of corporates TMG is a proud owner of:
- TMG Loan Processing,
- Max Cash Title Loans (already familiar to us),
- Champion Title Loans,
- Title Loans King
The system makes a decision on your application for an online loan automatically for up to 5 minutes. The system itself sends the solution on the loan application via SMS and email message.
You can also see the status of the application for an online loan in the Cabinet. Before issuing a credit to the card, the service checks a new client using a scoring system.
As part of this procedure, a request is sent to the Bureau of Credit Histories, and personal data on open sources on the Internet are also checked. The check helps to determine solvency and set a maximum loan limit.
The company’s primary mission is to spread financial relief to people throughout the nation.
When a regular US borrower is asked of “What are the title loans near me?”, he would probably name Loancenter.com.
Every day, with their help, people solve urgent financial problems by arranging profitable title loans online without collecting documents, standing in lines, and endless dialing to an answering machine in banks.
Loancenter.com has a specific goal – to change the consumer lending market in the US, making it extremely transparent, simple, and convenient for customers.
The company understands that it is precisely when you urgently need the money that you don’t have time to go to the bank, the painful process of collecting documents, or the long wait for a decision from the bank.
That is why Loancenter.com will transfer money to you as soon as possible from the moment you submit an online loan application.
The online lending service is one of the five largest American short-term title loan companies. By providing quality, competitive services, the team of professionals want to increase citizens’ trust in microfinance organizations and to promote the development of the US lending market.
Your Comprehensive Guide To Title Loans
How Does a Title Loan Work?
Microfinance organizations operate within the legal framework and provide loans of different amounts (depending on the company and state of operating) under collateral. As a rule, these are short-term title loans up to 1 year. In rare cases, the loan term may be extended.
MFIs – allow you to get a loan during the day from the date of application. They give out loans even for citizens with a bad or zero credit history. They have a transparent accrual of interest and work on a simplified system of paperwork. To obtain a loan, the client needs only a passport and documents for real estate or vehicles. A loan is issued either online or in person.
Like other lending organizations, MFIs conclude a contract with a client and establish loan repayment terms.
Consider the main features of Auto Equity Loan – something that every potential borrower who plans to arrange this type of microloan should know.
The car that you take on credit becomes a guarantee – until you completely pay off the debt, you have no right to sell, exchange, or return it.
Mandatory car insurance for the entire loan term – most often the lender works with only one insurance company, and under the terms of the contract, the borrower does not have the right to choose another.
Summary: when issuing secured loans, the client agrees to voluntarily transfer his property, car, or any other valuable things to the lender for a while. In case of non-payment of the loan, the collateral remains with the non-banking organization. The debtor will have to pay penalties.
Pros and cons
|Optimal percentage;wide time range allocated for repayment of a loan;the ability to borrow a large amount of money;income statements and guarantors are not always required||Compulsory insurance;there is a chance of loss of property;there is no function to arrange a deferment|
Car Title Loan Requirements
In general, the requirements for potential borrowers are simple – to be a citizen of the US at the age of 18 (sometimes from 21-25 years) and have a constant source of income, which will allow you to make timely payments on debt.
Next, we give an example list of documents that may be needed for a microloan:
- Original vehicle title showing sole ownership
- Government-issued identification matching the name on the title
- Utility bill or other proof of residency matching the name on the title
- Current vehicle registration
- Proof of vehicle insurance
- Recent pay stubs or other proof of ability to repay the loan
- Names, phone numbers, and addresses of at least two valid references
- Working copies of the vehicle’s keys
Unlike banks that allow you to take, for example, an online car loan, non-bank organizations do not have specialized loan programs, such as mortgage loans and car loans. In MFIs, for example, you can take short-term loans “Before salary” and “Before retirement.” They help potential borrowers lend a small amount and, as they say, hold out from paycheck to paycheck or pension. Also, in MFIs, you can take consumer loans for any purpose, whether it’s buying large household appliances, purchasing commercial equipment or paying for contractor services, medical services, etc.
On average title loans due within 15 to 30 days. But repaying it isn’t as easy as it may seem. There are cases when you have to roll over the loan repayment.
“Rolling over” means you may not repay the loan but take a brand new one for another 30 days. But this method is also non-profitable as you will have to pay another fees and deal with interest rates for another loan. That’s why some states limit this way of taking a loan.
Interest rates: at first glance it may seem that a monthly rate of 25 percent isn’t so big, but whether this loan is carried for a year the annual percentage rate (APR) of interest will reach even 300 percent, which is not so appealing.
For more detailed information (terms, rates, etc.) it is better for you to check it directly on the website of the company you are going to take a title loan.
The lion part of companies providing title loans set a very short loan term. Typically they range from 30 days to 90. Within this period, the lender is required to pay off his debt.
The average amount you can borrow via car title loan negotiates in the range from $2,510.00 to $50,000, usually coming with APR or interest at an annual percentage rate of the figure about 300%. On average we have 25% in interest charges per month.
Banks, as a rule, give large loans, for example, for the purchase of cars, real estate, equipment, and other expensive equipment on bail. Moreover, a pledge can serve both in the amount of the first installment and the collateral. In the role of the latter, valuable things belonging to a potential borrower, or those items and objects that he plans to buy on credit, can act on the one hand.
Non-bank credit organizations also issue loans against collateral. Unlike banks, organizations such as pawnshops accept not only large collateral but also small ones.
Despite the fact that microfinance organizations do not issue targeted loans for the purchase of cars, it is still possible to use a microloan to purchase a vehicle. As mentioned above, you can get a microloan in the amount of up to $50,000. Therefore, an inappropriate loan can be issued on bail in the amount of from $2,000 to $3,000, from $20,000 to $30,000 from $40,000 to $45,000, up to $50,000 depending on the organization you chose. A pledge may be both a car and any other valuable property.
Without a pledge, you can get a microloan in the amount of up to $1000, over this amount loans are issued exclusively on bail. However, there is one caveat. Microcredit organizations do not issue loans in excess of $1000 to those borrowers whom they see for the first time.
With further cooperation (provided that the previous loan is fully repaid), MFI representatives allow increasing the credit limit to $15,000, the next one to $20-30,000, up to $50,000, etc.
Therefore, if you first applied for a loan, then you most likely will not be given a large loan amount without collateral. However, there is a plus. A microloan received in a microfinance organization can be used as the first installment for a bank car loan.
At the same time, a car loan will be beneficial to both you and the MFI. You can increase your chances of approving a loan application by providing collateral. And the MFI will receive a kind of guarantee that you can ultimately return the amount of money received on credit.
For the same purpose, you can contact several MFIs at once. Thus, you can increase the amount of the down payment and get a car loan faster at the bank.
Both unpaid title loans and paid ones influence your credit. Since you have not repaid a title loan your credit rating will have the corresponding changes.
Responsibility for non-payment of a loan occurs in case of missing one payment.
What threatens if you do not pay a loan? The consequences can only be provided by contract and law. Any other actions that the lender’s employees are trying to manipulate are illegal.
Penalties (fixed amount);
Penalty (proportionally varies from the amount of delay);
A ban on obtaining a loan (most often a credit limit on a card) in the same bank in the future;
Litigation with the arrest and sale of the property as a result (with the debtor and/or guarantor);
Obtaining a bank’s title to a pledge.
So don’t be afraid of the jail. Remember that the only thing the lender has the right to do is not so scary. He just has the power to take possession of your vehicle in a reasonable way.
The requirements for obtaining a loan on bail are approximately similar to the conditions for obtaining any other loan. You must have a credit history, as well as a package of documents, which primarily implies a passport and tax identification number (TIN).
Also, these are documents showing your income for a certain period (as a rule, you need to have a stable income for at least six months at one workplace). They may ask for other additional documents. For a private entrepreneur, you will need to provide a business plan and a debt repayment plan.
Thus you don’t have to bring your car to the company’s office to get a car title loan. Just take thought how do people apply online in case bringing a vehicle is mandatory.
In this case, we are talking about those vehicles that were previously pledged, but the owners did not buy them for any reason. The main advantage of such purchases is that the prices of these cars are much lower than market prices. The decrease in prices is due, first of all, to the desire of the auto pawnshop to sell the mortgage car more quickly and return its money.
In addition, some pawnshops provide trade-in service. It allows you to exchange your used car with a surcharge for a modern vehicle model. In this case, you can buy only those cars that are at the pawnshop at the time of the transaction. And if you do not have your own money to buy mortgage transport, then you can always take it, you can take one or more microloans and solve this problem. But remember that such loans are issued exclusively on bail.