Many people have financial problems for various reasons. Sometimes these issues are so bad that it is necessary to get a loan. Car title loans are helpful in case of emergencies. If you have been considering a car title loan, then this article can provide you some very useful information that you need to know.
Understand what APR means before agreeing to a car title loan. APR, or annual percentage rate, is the amount of interest that the company charges on the loan while you are paying it back. Even though car title loans are quick and convenient, compare their APRs with the APR charged by a bank or your credit card company. Most likely, the car title loan’s APR will be much higher. Ask what the car title loan’s interest rate is first, before you make a decision to borrow any money.
Be sure you understand any hidden fees that may be involved. There are often numbers in the small print that can make a tremendous impact on the overall repayment numbers. There are many horror stories about people who signed the loan documents before they learned how much the loan would cost. Ask questions, read all forms and disclosures, and avoid being taken advantage of.
Be aware of all costs associated with your car title loan. Lots of folks are amazed by the cost of these loans. Don’t be afraid to inquire what the interest rates for a car title loan are.
If you find yourself stuck with a car title loan that you cannot pay off, call the loan company, and lodge a complaint. Most people have legitimate complaints, about the high fees charged to extend car title loans for another pay period. Most loan companies will give you a discount on your loan fees or interest, but you don’t get if you don’t ask — so be sure to ask!
Realize that you are giving the car title loan access to your personal banking information. That is great when you see the loan deposit! However, they will also be making withdrawals from your account. Make sure you feel comfortable with a company having that kind of access to your bank account. Know to expect that they will use that access.
Be very careful rolling over any kind of car title loan. Often, people think that they will pay on the following pay period, but their loan ends up getting larger and larger until they are left with almost no money coming in from their paycheck. They are caught in a cycle where they cannot pay it back.
Understand the penalties for late payments. Naturally, if you accept a car title loan, you must be able and willing to pay on time. Nonetheless, the unexpected does have a way of happening. You need to read over any of the fine print on your contract so you know what kinds of fees you’ll have to pay. Car title loans tend to carry high penalty costs.
Now that you have a better idea of how a car title loan works, you are better equipped to make a decision on one. Remember that a car title loan is a temporary solution but could be the best way to take care of an emergency. Utilize the information that has been given on car title loans, and if you do, you can improve your financial life.