If you’re in need of quick cash and want to take out a short-term loan, a car title loan is one of the most effective options you have available to you. The big thing you need to know is that they’re going to cost a lot, so it’s important you are confident in your ability to pay them back quickly.
Here is some important information about title loans in AZ for you to consider.
Eligibility and payment considerations
While it’s not particularly difficult to get a title loan, you are not eligible to get the loan if you do not actually own your vehicle.
You should have a very clear sense of how much money you can borrow. This value will be determined by the value of your car, or the equity you have in the vehicle. The more valuable the car, the more money you’re able to take out in a title loan. Lenders will typically be happy to give you the amount of money they could get quickly and easily for the vehicle in the event they’d need to sell it.
You can expect loans to last a couple months to a couple years. Some lenders have prepayment penalties and others do not, so make sure you talk over this information with your chosen lender before agreeing to any contracts.
The risks you face when taking out title loans
Obviously, the biggest risk you face when using a title loan is that you could potentially lose your vehicle. If you cannot pay back the loan, the lender has the right to sell the vehicle to make up for the loss. This is the inherent risk that comes with using any type of possession as collateral for a loan.
Losing a car will have a significant impact on your everyday life. You will no longer have it for your work commute, for taking your children to and from school and activities or to get to the grocery store. This will give you a significant amount of logistical stress on top of the financial stress you likely experience. This is why it’s important to emphasize, yet again, that you should only take on the risk of a title loan if you’re absolutely certain you can repay it.
Other options before choosing a title loan
Have you considered all the alternatives to a title loan? Depending on the interest rates you’ll be responsible for or the risk you bear of losing your car, there could be other options that are actually better for your purposes.
Credit cards might have higher interest rates, but at least there’s no risk of losing your car. Personal loans will give you a longer repayment term and lower interest rates—if you have the credit to make it work, this is typically a better option. You might even consider taking on additional work for extra income, if it’s at all feasible.
For more information about title loans in AZ, contact Cash-N-Go Auto Title Loans of Phoenix today.
Categorised in: Title Loans