Understanding Title Loan Risks and Benefits

What Is a Title Loan and How Does It Work?

Before you can learn more about the title loan risks and benefits to consider, it is important to understand what a car title loan is and how it works. Thankfully, the application and repayment process for auto title loans can be simple enough for anyone to understand.¹

An online title loan, also known as an auto equity loan, is a vehicle-secured loan that allows you to borrow against your car’s equity by pledging your vehicle’s title as collateral for the loan. Using your car title as collateral to get fast funding means that you can typically expect a much more flexible application process than many traditional bank loans. Generally, you can access up to half or more of your car’s value when qualifying for a quick title loan online. To be eligible for the money you need for unexpected expenses, ensure you have a vehicle title in your name and in your possession.

In addition to having a car or truck title in your name, you must meet the title loan requirements to be eligible for a loan against your car. While the specific requirements can vary by lender, the following criteria typically apply :¹

• Be 18 Years of Age or Older
• Possess a Car, Truck, or SUV with Sufficient Positive Equity
• Demonstrate Evidence of Your Ability to Handle the Title Loan Monthly Payments

If you receive full approval and decide to sign your loan contract, a title loan lender will typically place a lien on your car’s title after the loan proceeds are disbursed. The lien will remain on the title throughout the duration of the loan and will not be released by the title lender until you’ve completed your payment obligations. However, that doesn’t mean you will lose access to your car after receiving your title loan funds! You can keep driving your vehicle throughout the repayment period as long as you make your loan payments on time.

The ability to maintain access to your vehicle is one of the many perks you can expect as a ChoiceCash title loan borrower. With ChoiceCash title loans serviced by LoanMart, you can receive exclusive benefits that add to your loan experience, including flexible loan terms, competitive interest rates, and a convenient application process!¹ Continue reading for more information about the potential title loan risks and expected benefits. If you’re responsible for your title loan installment payments, you can expect a smooth application and repayment process.

What Are the Benefits of Getting an Auto Title Loan?

Auto title loans can provide valuable benefits beyond fast financial relief. If you’re thinking about applying for a vehicle-secured loan to handle an urgent medical bill or another personal expense, you can expect to access multiple perks that can impact your borrowing experience.¹

Check out some of the benefits you can receive when obtaining approval for online title loans with no store visit:

Quick Access to Cash for Financial Emergencies

When you’re facing a financial emergency and have time constraints, you need a fast loan option that can help you get back on your feet. If you qualify for a ChoiceCash title loan serviced by LoanMart, you can choose direct deposit or have your funds added to a debit card to get your cash in as little as one business day! In some cases, qualified applicants can receive their funds the same day they’re approved.¹

Bad Credit Won’t Always Hold You Back

You don’t need a perfect credit history to be eligible for a title loan. Even if you had trouble getting approved for a loan in the past due to your credit score, you can still qualify for an auto title loan with bad credit!¹ Credit checks are often still used as part of the title loan application process; therefore, finding no credit check title loans online may not be an option.

Flexible Repayment Options

You will have various payment methods available to you as a ChoiceCash title loan borrower, including setting up automatic payments from a bank account, paying online through the customer web portal, or making payments in person at a participating money transfer location.

Potential for Large Loan Amounts

As mentioned previously, you can typically access up to half or more of your vehicle’s equity if you’re eligible for an auto title loan online. The greater the equity in your car, the more money you can potentially borrow through a loan against your car if you have the income to manage larger monthly payments. Depending on your vehicle’s value and your ability to make car title loan payments, you can access up to $15,000 if you qualify for a ChoiceCash car title loan serviced by LoanMart. If you don’t know your car’s current value, you can conveniently use ChoiceCash’s title loan calculator to get a quick equity estimate and a loan quote, free of obligation.¹

Many Ways to Spend Your Funds

If you’re eligible for a ChoiceCash title loan serviced by LoanMart, you can use your title loan money to cover various issues.¹ Once you receive your loan proceeds, you can pay for different emergency expenses, like medical bills, rent payments, veterinarian bills, etc. However, you aren’t required to use your cash to handle a financial crisis. You have the freedom to spend your money on home renovations, large purchases, or moving expenses.

What Are the Risks of Getting Car Title Loans Near Me?

While car title loans have many significant advantages, there are some potential drawbacks you should be aware of before you decide to submit a loan request. Fortunately, you can work to avoid these possible risks by implementing effective strategies that can help you stay on top of your payment obligations until your very last loan payment! Take a look at some of the potential risks associated with online title loans:

Potentially Losing Your Car to a Repossession

Missing your loan payments and defaulting on your title loan can result in a title lender repossessing your vehicle and selling it in order to recover the remaining amount owed on your account. Many title loan lenders are willing to discuss your options if you’re having trouble with your monthly payments and may offer options to help you stay on track with your payments. If your financial situation changes during the repayment process, it’s crucial to contact your lender or loan servicer prior to a title loan default. You may be able to refinance your current title loan or request a loan extension to make your payments more manageable that month.

Credit History Could Be Negatively Impacted

Defaulting on your title loan can harm your credit score if your title lender reports your payment behavior to one of the three major credit bureaus: Experian, Equifax, or TransUnion. Like with any other payment obligation, it is essential to prioritize your monthly title loan payments and follow a strict budgeting plan. There are many budgeting techniques available that can help you stay on top of your loan payments and avoid potential title loan risks, but some of the most popular ones include the 50/30/20 rule and the “Pay Yourself First” method. Regardless of which technique you choose, ensure you have enough funds to make your scheduled payments by cutting back on non-essential expenses.

Recognizing the potential title loan risks and benefits is important as an applicant, but you can avoid the consequences of loan default by paying your loan on time each month.

Are There Safe Alternatives to Title Loans?

Are you worried about the potential drawbacks of a car title loan? You may be searching for alternative options to get fast financial assistance. If you need money now to handle an unexpected expense, you can consider these alternative methods to get yourself back on your feet:

• Borrow Funds from Friends and Family: Many people turn to their loved ones for advice on personal issues or assistance with troubling situations. However, borrowing money from friends and family can become problematic when a person doesn’t set clear expectations for how they will pay back their loan from a loved one. If you ask a relative or a friend for financial help, ensure you establish an effective payment plan that all parties are comfortable with implementing.
• Apply for a Personal Loan: A personal loan is an installment loan option that comes with a wide range of interest rates and loan terms, with repayment periods often lasting anywhere from one to five years. Eligibility for a personal loan is often dependent on your credit score, income, and debt-to-income ratio, which can make it difficult to receive approval if you have bad credit.
• Use a Credit Card Cash Advance: Individuals with credit cards can ask their provider for a credit card cash advance to borrow against their available line of credit. Through this method, you can take out cash by getting a convenience check linked to your account or simply withdrawing money from your nearest participating ATM. There are drawbacks to getting a cash advance with your credit card, like cash advance fees (typically 3%-5% of the cash advance amount), ATM withdrawal fees, and higher interest rates than regular purchases made with your card. Additionally, you can only borrow against your available credit line, so if your card has a high balance and you are almost at your credit limit, this type of cash advance may not be the best option.

Understanding all of your options can help you make an informed decision and choose the right path forward to get your finances back on track. If you want a convenient way to get fast cash, consider applying for a ChoiceCash title loan serviced by LoanMart! Visit our FAQ page or call a title loan representative at 855-422-7402 if you have any questions about getting a car title loan online.¹

Consider the Title Loan Risks and Benefits Before You Apply

Prospective borrowers should research available resources to get fast funding and carefully review the pros and cons of each option before starting an application. If you need quick funds and are interested in applying for a car title loan, it is imperative that you consider the title loan risks and benefits in order to make an informed decision.

If a title loan sounds like the right fit for your finances, you can expect a simple and efficient application process through ChoiceCash title loans! Take a look at the three basic steps you must follow to get emergency funding in as little as 24 hours:¹

1. Choose to Apply Online or Over the Phone at 855-422-7402
2. Submit a Few Documents to Verify Your Information:
   • Proof of Address
   • A Vehicle Title in Your Name
   • Recent Pictures of Your Car, Truck, or SUV
   • Valid, Government-Issued Photo ID Card
   • Evidence of Income
3. If You are Fully Approved, Receive Your Title Loan Money!¹

If you qualify for a title loan and decide to sign your loan contract, you can receive several benefits, including extended loan terms and exceptional customer service. While it’s important to acknowledge the potential risks of a car title loan, you can avoid the consequences of loan default by being a responsible borrower and effectively managing your loan installment payments. Dial 855-422-7402 if you have questions about getting an auto title loan, or fill out a brief questionnaire now to begin your application from the comfort of your home!