Car Title Loans: What's The Secret?

It's no secret that the economy is still struggling and those of us who live paycheck to paycheck can find ourselves falling short financially before that paycheck goes in the bank. Paying the bills or dealing with a financial emergency is difficult when there is no savings set aside to depend on. Trying to find a way to get through a temporary financial bind can be trying when your credit score doesn't warrant taking out a traditional bank loan or credit card. That's where car title loans come in handy. By using the equity in your automobile, you can deal with those short-term finances without having to wrestle with your bank or credit union and worry about how your credit score will come into play when it's time to get approved.

Car title loans are similar to payday loans in that they are fast and convenient, don't require a credit check, and can be accessed conveniently online from the comfort of the borrower's home. Keep in mind that these "small-dollar" loans, as some would call them, are meant for short-term finances; not to be turned into long-term debt. Car title loan lenders understand the need for fast cash and can fund a person overnight, but they also expect to be paid back quickly; generally with the borrower's next paycheck. Because car title loans offer higher dollar amounts than a typical payday loan or cash advance, lenders will most often set loan repayment terms at about 3 months. Interest rates on these types of loans are higher because of the risk the lender takes in loaning money on such a short-term basis. But for those consumers who own their car outright, can provide the title ("pink slip") to the lender for the duration of the loan, have a steady job and direct deposit of their paycheck, and a willingness to repay what they borrow, car title loans can be ideal for those unexpected cash emergencies or difficult to pay monthly finances.

It's not a secret that the payday lending industry has grown tremendously in the past few decades. While borrowing on credit has become a much more stringent process with the advent of the FICO score, consumers have had to get creative in an attempt to gain access to fast cash. Short-term lending allows people to get through temporary financial situations without the hassle and time-consuming process of borrowing with a traditional financial institution.

Finding a car title loan lender can be done online or by browsing the phone book to find a store-front location. The process is generally very quick and stress-free. Most of often borrower's can have access to their cash within 24 hours of applying and being approved. Repayment of car title loans involves the borrower having a checking account with direct deposit of their paycheck. Lender typically draw payments out of the loan holder's account once that person's paycheck is deposited on payday. For the most part it is a very smooth process. It's important to remember, though, that these types of loans are only for people who know they are going to be able to pay back what they borrow, within a short amount of time. If there is uncertainty about repayment, it's best that a person look to other avenues as a means to getting through a temporary financial situation.

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