Access to emergency cash is something that every family should have in order to deal with unexpected problems, such as an unavoidable car repair, or a critical medical or dental procedure. But situations happen often that prevent families from keeping their emergency fund fully funded or even building one in the first place, including loss of a job or an illness that causes them to miss work. In these situations, taking out a temporary loan, such as an auto title loan is one option to consider. If your family is experiencing a sudden financial need, here are three things you should know before applying for an auto title loan.
Consider other ways to raise the cash first
Taking on new credit in a tight financial situation should never be approached without careful consideration. Instead, consider taking on a part-time job or selling some unnecessary personal possessions to raise the funds you need. If, however, you need money quickly, then a title loan may be your fastest option.
Make sure the repayment terms are doable
The terms offered by auto loan lenders can vary, so it is very important that all applicants take time to carefully read all terms and information before agreeing to sign and accepting the funds. Auto title loans are meant to be very short term loans. Their annual percentage rates (APR) are higher than lending rates charged by banks, so borrowers must be sure they can pay off the full loan amount within the initial repayment period, without having to extend the loan.
Only apply with a reputable auto loan lender
Like any lending institution, auto title loan lenders vary widely in their customer service, rates, and the repayment terms they offer to loan applicants. Whenever anyone is considering applying for a title loan, they should always take time to review and compare each available title loan lender in their area.
Some good ways to do this include looking at the auto title loan lender's social media pages and reading the comments, as well as checking review sites to see what verified users had to say about their experience in working with the auto title loan lender.
It is also a good idea to stop by the office of any auto title loan lender you are considering working with to pick up printed information and ask questions before making the actual application. Auto title loans can be a good source of emergency money when used with care but should never be taken out without a viable plan for repayment.Share