One of the reasons for many people not getting access to the loans easily is that they are carrying a fault payment history. Such borrowers carry a high risks as they are more likely to repeat the past mistakes of payment defaults or late payments. The lending companies want to keep away from such worries and avoid the borrowers whose past credit record is highly risky. For this reason, the lenders assess the applicants’ credit report and outright refuse the loan if the credit rating is too low. For such people bad credit car title is the last resort to borrow cash for urgency purposes such as timely payment of bills.
A lender who is in the business of providing bad credit car title loan will not usually be hesitative in fast approving the applications for smaller funds. Why is so? Simply because the lender has put in place a mechanism to protect him from the risks. The lenders will not even the credit history of the lenders prior to approval of the loan. Any lending company that offers these loans will take car title papers from the owner of the car who is also the borrower. The title will serve the purpose of securing the loan and will be taken as collateral. The lender will also have extra car keys of the car. However, the loan applicant can drive the car as usual after handing over the car title and additional keys to the loan provider.
Clearly, there is no need for the bad credit car title lending company to ask the application to reveal his or her past payment record. The applicants have no fear of their credit report being pulled for evaluation. In other words, your credit history will not be known to the lender in borrowing the money.
What are the major requirements for the loan? Though your bad credit history is not an issue for the lenders, still you need to abide by some preconditions. As a car owner, you must not be holding any liabilities against the car. This means that you can borrow the cash only if you have cleared all the installments of your car loan. You will be submitting the car title of which you are legitimate owner. The car must be less than 10 years old. The borrower’s age must be above 18 years to be eligible for these types of cash loans.
Before you apply for bad credit car title, you must ensure certain aspects of the loan. First of all, you should know about the equity you presently carry in your car. To find this, subtract the amount you owe on the car from the vehicle’s existing market price. You should plan to borrow an amount lesser than the amount you calculate. Find out the lenders who are willing to approve you a loan in such a way.
Normally, you will be approved for a smaller amount. The bad credit car title loan is usually meant to serve the borrowers in their dire times. Hence, usual range of the loan goes up to a maximum of $1000. Often, such an amount is sufficient to get rid of urgent bills in order to avoid late payment penalties or to meet ends ahead of next paycheque. However, search for the lenders who are approving greater amount of loan if you must have more money for a short period.
When it comes to repaying bad credit car title amount, take note of the fact that these are expensive loans. Due to risks and short term of the loan, the lenders will charge very costly APR on the loan. This means that you will pay back the loan at huge interest amount that may put burden on your next salary cheque. It is, therefore, advisable to get rid of the loan repayment as early as you possibly can.
You can choose to repay the bad credit car title loan on any day after a certain period allotted by the lender. Find out if the lender will charge early repayment fee if you desire to do so. So, you can take few weeks to months in repaying the loan but pay it off soon.
To conclude, we can say that while bad credit car title is a sure shot way to find the lenders and timely cash in your bank account in the same day, care should be taken for timely repayment. These are expensive loans for smaller salary earners and so timely and early repayment is always advised.