Car title loans are a type of secured loan because the car title is used as collateral. This ensures the lender receives their money back in case of default.
There are risks to acquiring a car title loan, but there are a number of benefits as well. Take a look!
How a Car Title Loan Works
Car title loans are a specific type of loan available to drivers that need financial support. When unexpected financial disasters spring up, a person can use their car to acquire the emergency cash they need in a jiffy.
Car title loans are secure because a borrower’s car title is used as collateral. The title is given to the lender for safekeeping, but the borrower to keep their car while they pay off the loan.
Because this type of loan can be considered low risk, a lender is able to offer greater benefits to the borrower. Car title loans may have higher loan values, longer duration periods, and better terms.
Car title lenders are also more likely to take on customers that have low credit, making this type of loan preferable to personal loans or Payday loans for many people.
Once a loan is paid back in full to the lender, the car title is returned to the borrower and the contract is completed.
Default and Repossession
Default occurs when a borrower fails to make one, or several payments. The number of missed payments resulting in default depends on the state. This website lists the repossession laws for every state.
If a borrower happens to miss a payment, they shouldn’t panic! Lenders aren’t just sitting around waiting for any excuse to repossess a car. In truth, lenders don’t want to keep borrower’s cars. They’d much rather have a borrowers business.
So if a payment is missed, simply contact the lender and let them know what happened. If a borrower knows they are going to miss a payment in advance, they should try to ask for an extension. Most lenders allow extensions if given enough notice. There’s no harm in asking.
If a borrower is having trouble making their monthly payments, they should also let a lender know. Sometimes a contract can be reworked, allowing for an adjusted monthly installment.
But if a borrower continuously fails to make their monthly payments, and doesn’t keep in contact with an agent, the car will have to be repossessed. The car will be taken to a secure tow yard and held there until the borrower and the loan company agent can reach an agreement.
But if a borrower makes no effort to retrieve their car or contact the lender, the car will be sold at auction. The money made from the sale will be used to pay off the remaining balance of the loan. If the total sale price of the car doesn’t cover everything, then the borrower will still be held responsible for paying the difference.
Process of Acquiring a Car Title Loan
Acquiring a car title loan has both benefits and risks. MaxCash makes sure to do a surplus of research and comparisons to find reasonable loans for our clients. MaxCash offers people free loan assistance and free financial guidance.
To get started and see if you qualify for a car title loan, check out the steps below!
- Complete the online questionnaire on our website. The form will ask for contact information and the cars details.
- MaxCash makes an initial phone call to the client and informs them if they have a good chance of qualifying for a car title loan.
- MaxCash makes several calls to lenders and asks all of the tough questions. We acquire all the information a borrower needs to know, and haggle lenders to achieve affordable loan offers.
- If eligible, we present any loan offers to the client. The client then decides if they want to pursue a car title loan.
- When a client decides to accept a loan offer, we connect them to the lender. Clients will then finish the loan process directly with the lender and continue working directly with them.
We don’t hold our clients to anything. If a client decides not to pursue a loan offer, we don’t pressure them. In order to complete the loan process, a client will need a few key pieces of information, as well as documentation.
Generally speaking, lenders will ask for the same information. But this isn’t always the case. Every client is facing a unique situation, so the
Here’s a list of what you may be asked to provide:
- A government issued photo ID
- Social security number
- A qualifying car title in your name
- Proof of insurance, residence, and income
- Pictures of your car
- Personal references (only in some cases)
MaxCash works hard to provide affordable loans to clients because we want to promote financial success. We know that money can mean the difference between thriving and struggling. So we strive to help eligible clients receive the emergency money they need.
We work from 6am to 9pm, every single day. We know that financial disasters can occur at any time, and without warning. So we have extended hours to better accommodate those in need of immediate assistance.
Don’t waste hours of your time trying to get multiple quotes from several lenders. Make us do all the work instead! For free! We look forward to working with you!