A lot has been said about the dangers of car title loans. Over the last decade, the hidden charges attached to these loans has targeted ordinary people at a time when they needed financial aid the most. This has given them a black mark in the eyes of most people today. However, today’s auto title loans do away with all of the previous credit doom and gloom, and they typically provide substantially better interest rates than you would might expect from their closest competitors, payday loans.
Auto title loans are exactly what they advertise to be: loans that are secured to the title of a vehicle. The loan’s value is tied to the market value of the car, and the car becomes the guarantee for the loan. These loans now have fewer charges and are more affordable considering the term is set at 36 months, giving ordinary employees ample time to pay off the amount.
People interested in taking out one of these loans can rest assured that only institutions certified with auto title loans can give out funds like this. The biggest hurdle will be actually owning a car that is valued at $4,000 or more, the minimum requirement for this credit package. Because of the fewer charges, there are more paperwork needed as well such as proof of car ownership, proof of income, and the like.
Still, these requirements are reasonable compared to the loan amount that is being given away. When used responsibly, a car loan can be extremely useful for getting out of messy financial situations.