Here’s the simplest definition of auto title loans: car title = $5,000 cash loan.
That’s right. You can get instant cash loan having only the car title as collateral. So you can literally drive your car away right after getting instant cash. At least, that’s how advertisers make it seem. But do auto title loans really give you easy and fast cash?
Here’s the usual process of applying for auto title loans:
1. Apply. Inform the creditor about your intention to borrow some money. Submit the required documents for auto title loans like the original title, vehicle, driver’s license, proof of income, proof of residence, and proof of insurance.
2. Assess. The submitted requirements will be assessed to determine the maximum amount that you can borrow. Mostly, it’s 50% of the vehicle’s market value, though other deals can go higher. Monthly income, credit record, and asked amount are also considered on the deal. Just keep in mind that the higher the asked amount, the more difficult it can be approved.
3. Approve. Auto title loans are 99.9% approved as long as you have a clean car title. The catch is that auto title loans are notorious for giving high interest rates (36 to 650%), which is common in fast-easy-cash loans. The interest depends on your monthly income and credit record. Typically, the riskier you are, the higher will be the interest rate.
Auto title loans are payable within 36 months. So even with high interest, paying auto title loans will be a breeze.