How Texas Title Loans Work
Many people in Texas have probably heard of auto title loans but want to learn a thing or two about them such as how they work . Firstly, these types of loans are loans for small amounts of money and for a relatively short period of time, typically 30 days. The borrower uses their vehicle as collateral which means that, in the event they’re unable to repay the loan, they might lose the car. Car title loans are mainly used as cash advances and can be convenient when you need some cash really quickly but have low credit rating.
3 Steps to Get Your Title Loan!
In general, applying for this kind of loan is a very simple process. If you have a clear, lien-free title to your vehicle, which should also be in good working condition, a lender may consider giving you the money you need. Applications are usually processed quickly and can be carried out online or at a local store. Here’s how it works:
- The first step towards applying for car loans is to identify a lender by considering factors such as interest rates, requirements and so on. Once you’ve picked one, you need to show them your application, vehicle, the title to the car and a photo ID, and then pay a fee to borrow the money. Note that some lenders may also require a copy of your car keys .With these loans, the lender does not carry out any credit check.
- On receiving your application, the lender will assess the car’s value with a detailed inspection and then decide whether or not to loan you the money. If he deems you to have met the auto title loan requirements, he will give you the money or remit it to you account, if requested, and then keep your title. The maximum amount one can borrow may vary, but it is typically 50% or less than the actual vehicle’s value.
- At the end of 30 days from the day of taking out the loan, you’re expected to pay the lender the lender the amount borrowed plus interest fees. If you’re unable to repay the money after the period elapses, the lender might allow you to “rollover” the loan, like is the case with payday loans. This simply means that you borrow the money for another 30 days and requires the payment of an additional monthly fee.