Tough financial times can strike nearly anyone at anytime. If you are currently facing a difficult money situation and need quick help, you might be considering the option of a car title loan. If so, the following article will help educate you as a consumer, and enable you to make a smart decision.

If circumstances require you to seek car title loans, it is important to know that you will have to pay exorbitant rates of interest. In most cases, the effective APR will be hundreds of percent. The lenders that do this usually use every loophole they can to get away with it.

Do your research. Don’t just accept the first lender to offer you money. Always weigh multiple lenders, and shop for a lower rete. Though you might need to spend more time than you thought, you can realize real savings. Sometimes the companies are helpful enough to offer at-a-glance information.

If you must get a car title loan, open a new checking account at a bank you don’t normally use. Ask the bank for temporary checks, and use this account to get your car title loan. When your loan comes due, deposit the amount, you need to pay off the loan into your new bank account. This protects your regular income in case you can’t pay the loan back on time.

When considering taking out a car title loan, be sure you understand the repayment method. Sometimes you may have to send the lender a post dated check that they will cash on the due date. Other times, you will just have to provide them with your checking account information, and they will automatically deduct your payment from your account.

Before applying for a car title loan, make sure you understand all of the terms. Some companies require you to have been employed for at least three months or more. This way they can verify that you plan to pay them back.

Choose your references wisely. Some car title loan companies require you to name two, or three references. These are the people that they will call, if there is a problem and you cannot be reached. Make sure your references can be reached. Moreover, make sure that you alert your references, that you are using them. This will help them to expect any calls.

Look for different loan programs that might work better for your personal situation. Because car title loans are becoming more popular, loan companies are stating to offer a little more flexibility in their loan programs. Some companies offer 30-day repayments rather than one to two weeks, and you may qualify for a staggered repayment plan that can make the loan easier to pay back.

If a car title loan is needed, it should only be used if there is no other choice. The effective interest rate for a car title loan is extreme, with the total fees for a two-week loan generally equaling 15%-25% of the amount borrowed. Before taking out a car title loan, think about other options.

You should now be fully informed about car title loans and how they might be able to help you out of your monetary woes quickly. Knowing all of your options, especially if they are limited, will help you to make the right choices to get you out of your bind and onto better financial ground.

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