Car Title Loans: Three Things You Should Know

Car title loans are specially designed for those who need quick cash to pay bills, face an emergency, or manage debt. If you owe or own a certain vehicle very little, an auto title loan – also known as a “quick auto loan” – is fairly easy to obtain. However, quick and easy is sometimes too good to be trusted. You will end up paying high fees for this type of loan, and losing your car is also a risk.

Before you go with a decent car title loan, here are three things you need to know.

To start

  1. If you want to get a car Miami securities lending, you must own your car or at least have equity.

In other words, an auto title loan is basically a small secured loan that often uses your car as collateral. Typically, car title loans range from $ 100 to $ 5,500, which is usually an amount equal to 25 to 50% of the value of the car. Often the loan term is short; only 15 or 30 days. And although it is known as a “car” title loan, this type of loan also applies to other vehicles, such as motorcycles and trucks.

If you want to get a car title loan, the requirements are clear title – that is, 100% ownership of the vehicle, without any liens – or some equity in your car.

Common question

What is equity?

Equity is the value of the asset, such as a house or a car, minus any debt you owe on that particular asset.

“Title pawns”, “title pledges” or “pink coupon loans” are other common names for car title loans. The term “pink slip” essentially comes from the pink paper that California car titles were once printed on.

Typically, the lender will not only want to see your car title, but also your proof of insurance, photo ID, and your car.

When you get approval for a particular car loan, you issue title to your car to your lender in exchange for that loan. It is until you pay off the loan that you will get your title back.

  1. Car title loans have high interest rates and fees

When it comes to an auto title loan, it is very common for lenders to charge around 25% of the loan amount each month to fund the loan. If you get a 30 day car title loan for around $ 1,000, for example, the fee is 25% ($ 250), and you will need to incur $ 1,250, plus any additional costs, which will pay off your loan. at the end of the month .

This translates into an APR, or annual percentage rate, of over 300%. Generally speaking, this is significantly higher than many other forms of credit, such as credit cards. If you get an auto title loan, your lender should tell you the APR and the overall cost of the loan. Indeed, you can compare this information with that of other lenders to help you find the offer that is best for you.

  1. You could lose your car if you don’t pay off your car title loan

When you get an auto title loan and you don’t pay back the specific amount you borrowed, along with all fees, your lender can roll over your loan for a new one. Once you’ve done that, you’ll add even more interest and fees to the amount you renew.

For example, you might have a loan of $ 500 and fees of $ 125. You are not able to repay the full amount after the 30 day period. You decide to pay the $ 125 fee and then transfer the original $ 500 into a new loan with a 25% fee.

When you pay off your new loan, you’ll have paid an overall cost of $ 250 in fees out of the $ 500 you originally borrowed. When you keep renewing your loan, you might find yourself in a cycle of additional charges that makes paying the lender a daunting task.

The lender could in fact take back possession of your car if you find yourself in a situation where you are unable to repay the debt. And you could end up paying even more fees to recover the vehicle, as well as the overdue amount.

Simply put, if you are unable to resolve this issue, then you will have to look for (and pay for) other means of transportation.

Bruno Mars looks low-key as he buys a Vespa scooter with his girlfriend Jessica Caban

Bruno Mars looks low-key as he buys a Vespa scooter with his girlfriend Jessica Caban










Bruno Mars was in the mood to splurge on Wednesday.

The Please Me frontman looked ready to spend as he was spotted at a Vespa scooter retailer in Studio City.

Mars, 34, was dressed in a high fashion athleisure look during his shopping spree, where he was joined by his model girlfriend Jessica Caban.

Easygoing: Bruna Mars disguised herself by buying a Vespa in Studio City on Wednesday

Bruno was both casual and chic in his sporty outfit.

He donned a distressed Saint Laurent hoodie with Fila sweatpants and classic black and white Nike sneakers. He topped it off with a vintage-looking baseball cap and sunglasses.

The other half of the 24K Magic singer was dressed in her own casual style, wearing a gray hoodie, slightly faded jeans and white shoes. Adding an upscale touch, she carried a Prada bag.

After riding Italian scooters, he and his sweetheart returned home in his black SUV.

Sporty chic: He donned a distressed Saint Laurent hoodie with Fila sweatpants and classic black and white Nike sneakers

Sporty chic: He donned a distressed Saint Laurent hoodie with Fila sweatpants and classic black and white Nike sneakers

Simple style: The other half of the 24K Magic singer was dressed in her own casual style, wearing a gray hoodie, slightly faded jeans and white shoes

Simple style: The other half of the 24K Magic singer was dressed in her own casual style, wearing a gray hoodie, slightly faded jeans and white shoes

Bruno and Jessica have been together for nine years.

According to Mars biographer Emily Herbert, the couple met by chance when the Just The Way You Are singer spotted them at a restaurant in New York City and decided to introduce themselves.

They would live together in the Hollywood Hills with their dog Geronimo.

Go strong: Bruno and Jessica have been together for nine years.  Seen at the 2014 Grammy Awards above

Go strong: Bruno and Jessica have been together for nine years. Seen at the 2014 Grammy Awards above

Despite her great notoriety, the Hawaiian-born artist has kept their relationship out of the spotlight.

He briefly commented on their romance during an interview with Rolling Stone in 2016.

Bruno was taken aback when the magazine asked him if he would ever ask the question, telling them, “Jesus! She is my best friend. My rock. What the hell is wrong with that? We’re just happy.

Happy accident: According to Mars biographer Emily Herbert, the couple met by chance when the Just The Way You Are singer spotted them at a restaurant in New York City and decided to introduce themselves.

Happy accident: According to Mars biographer Emily Herbert, the couple met by chance when the Just The Way You Are singer spotted them at a restaurant in New York City and decided to introduce themselves.


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Why Car Title Loans Are A Bad Idea

(AOL Autos) – Cash advances are not a new concept in the brand of American capitalism. A lot of people have seen the ads with a guy barking, “Bad credit, no credit, no problem! Or, “Don’t worry about the credit, I own the bank!”

In addition to the high interest rates, these auto title loans usually include a number of fees that add up quickly.

In addition to the high interest rates, these auto title loans usually include a number of fees that add up quickly.

Anytime a guy tells you he owns the bank, run.

Even though these lenders have been around for a while, signing your car for a high interest loan has become a serious financial problem.

For those of you who are not familiar with the concept of auto title loans, allow us to explain.

Sometimes the best of us are strapped for cash; we may not have credit or bad credit (as they say in the ads), which makes it difficult for us to get small loans from a bank or some other more traditional way.

A title loan offers you money from the lender, in return you sign the title of your paid car to secure the loan. Typically, these loans are due in full 30 days later. There is no credit check and only a minimum income check.

It sounds simple enough, but borrowing in these places can lead to repossession of your car and a lot of financial problems.

Interest rate that makes credit card companies blush

Auto title loans have been lumped into the category of “predatory loans” by many consumers. Nonprofits such as the Consumer Federation of America (CFA) and the Center for Responsible Lending have published detailed reports describing some of the securities lending issues the public should be wary of.

One of the biggest issues with these loans is the interest rate. Many people dislike credit card interest rates, which average between the mid to upper teenage years for most Americans. The interest rates on car title loans make complaining about credit rates seem ridiculous.

Auto title lenders are a different category from credit card companies or banks and circumvent usury laws. Thus, title lenders are able to charge three-digit Annual Percentage Rates (APRs). Yes, three digits. It is no exaggeration to see 250% APR and more on these car tile loans and only a handful of states have passed strict laws that prohibit sky-high percentage rates.

Even if your credit card company charges you a high 25% APR interest, that’s nothing compared to car title loans. AOL Autos: the most popular used cars

Under federal law, property title lenders must disclose interest rates in annual percentage terms. If you need to get a title loan make sure they don’t just give you a monthly percentage rate quote, they have to give it to you as an APR. If they’re not clear on rates, which many may be, just know that a 25% monthly rate equals 300% APR.

Fees and interest only

In addition to the high interest rates, these auto title loans usually include a number of fees that add up quickly. These include processing fees, document fees, late fees, setup fees, and lien fees. AOL Autos: the safest cars

Sometimes there is also a roadside assistance program that borrowers can purchase for a small fee. Some lenders have even gone so far as to make roadside assistance compulsory. The cost of all of these fees can range from $ 80 to $ 115, even for a $ 500 loan.

Most of these fees are legal, except for one that lenders sometimes charge, the repossession fee. Lenders aren’t allowed to charge you for the trade-in of your vehicle, but some still do. AOL Autos: the best vans

As if high interest rates and a mountain of fees weren’t enough, lenders also offer borrowers the option of paying only interest for a set period of time. In these cases, the loans are usually put in place for a longer period (compared to the usual 30 days) and the borrower can only pay the interest on the loan.

These types of payments are called “balloon payments” where the borrower pays the interest on the loan each month and at the end of the term he still owes the full loan amount.

The CFA reported that a woman paid $ 400 per month for seven months with an interest-only payment deadline on a $ 3,000 loan. After paying $ 2,800 in interest, she still owed the original $ 3,000 by month eight. AOL Autos: The Most Popular Crossovers

Reversal and repossession

If you think that most of the people who take out these loans will pay them off in full after a month, think again. Due to the high interest rates and the fact that these lenders cater to low income borrowers, many people are not able to repay their loans within 30 days. This is called the “renewal” of the loan.

The terms of these loans are designed to keep borrowers in a cycle of indebtedness and bring customers to the brink of recovery or actual recovery. Not being able to pay off the original loan and then renew it the next month costs borrowers even more money in interest, on top of the original amount they have already borrowed. AOL Autos: Used luxury cars

Let’s talk about repossession for a minute. The CFA reported that of those polled in their 2004 study, 75% had to give title lenders a copy of their car keys. Some companies started the cars to see if they worked and took photos of the vehicle even before a customer filled out the loan application.

An Arizona-based company said it has installed GPS systems on cars so it can track cars and turn them off remotely if they don’t receive payment on time. It might be an extreme case, but these lenders take a customer’s pledge signing very seriously. If you can’t pay, they’ll come and pick you up and your car.

The concerns about repossessing your car are obvious. How do you get to work, drop the kids off at school, go shopping or go out on weekends without a car? As if those scenarios weren’t bad enough, owning a car can be some people’s biggest financial asset. If the car gets swept away, so does the money it was worth.

Some states have laws that require lenders to pay you the difference on the loan after a lender repossesses and sells your car, but some do not. It is possible to default on the loan and not get money back for your car, even if you only borrowed a few hundred dollars.

This happens because auto title loans are also over-secured. Typically, the maximum amount most lenders will give you is 25-50% of your car’s actual value. However, if you can’t pay off the loan, they might be able to sell your car and keep 100% of the profits. Some lenders will not take possession of a vehicle but instead sue the customer for the money. They then add legal fees and finance charges to the existing loan amount.

Alternatives

Many auto title lenders defend their business practices by saying that they offer loans to people who otherwise could not get financial assistance. While this may be partly true, giving away one of your most valuable assets for several hundred dollars isn’t the only option.

Some credit unions, like in North Carolina, started providing low-interest loans of around 12% APR, a fixed 31-day repayment plan (to avoid rolling over a loan), and implemented a direct deposit from the borrower’s paycheck. so that the loans are repaid in full.

Other options may be cash advances on your employer’s paychecks, cash advances on credit cards, emergency community assistance, small consumer loans, or borrowing from friends or family. family members.

If you are considering a car title loan, check out these alternative options and read the information for yourself at www.responsiblelending.org or www.consumerfed.org. If you still need to sell your car for cash, educate yourself about the decision and the possible repercussions of these types of loans.


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