If you need quick cash, then an online title loan might be the solution to your short-term financial problems. With so many companies to choose from, getting approved for a title loan is easy, but there are a few things that all potential borrowers should know before signing any contracts. Here are a few tips to help you understand how online title loans work and what to expect before signing on the dotted line.
What is a Title Loan?
A title loan also called a car title loan or auto title loan, is when someone borrows the money using their car as collateral. The borrower can use the money from the title loan online for anything they wish, but most people use it to pay off other bills or get out of an emergency financial bind. This type of loan is very popular because of its convenience.
How Much Money Can You Get?
The amount you can borrow with an online car title loan depends on how much money you make each month and what your car is worth. Car values range anywhere from a few hundred to a few thousand dollars, depending on the value of your vehicle. To get an idea of how much money you can borrow, here’s an illustration:
$500 car title loans + $1,000 in your bank account = $1,500 total income monthly
This means that you can borrow between $200 to $2,000 with an online car title loan. Depending on whether you sign up for a 6-12 month or 12-18 month loan, you will pay between $100 and $200 per month.
What are the Requirements?
Typically, to borrow money with an online title loan, you must meet all of the following requirements:
Must have a valid U.S. bank account-You must have an active checking account that can receive direct deposits. You will use this bank account to transfer your money every month.
Must be at least 18 years old-You should know that you cannot borrow money with a car title loan if you are under the age of 18.
Must have internet access- The entire process can be done online so it is important that you have Internet access. If you don’t meet this requirement, then you will have to look into local loan options that accept cash or check payments.
Must own a car – Make sure the title is free of any dispute before applying for an online title loan. If there are items listed on your car title, then you may be asked to sign over those rights as well.
Must provide proof of income- You will need to prove that you make at least $1,000 every month before getting approved for a car title loan online. The lender may ask you to show copies of your last couple of paychecks or bank statements as proof. They want to know what you do for a living and if you can afford to make the loan payments each month.
How Fast Will You Get Money?
After signing all the paperwork for your online car title loan, you should receive the money within 24 hours later. Most lenders do not work on weekends. However, if you are approved early in the day, say around nine to 10 AM, you may have the money in your bank account by 7 PM the same day. This all depends on how much paperwork the lender wants to be completed and what time you applied for the loan.
The Qualities To Look Out For In A Lender
When you begin searching for online car title loans, it’s important to remember that patience is key. Even if they are direct lenders, not all offer the best deals. You will have several options when you start shopping around for the best rates and terms on your loan and this allows you to compare apples-to-apples and make the best decision for yourself.
The main qualities to look out for when you start shopping around include:
Good customer service- You should try calling a company’s customer service department before signing any paperwork. These loans are done online, so if you can’t get in touch with them via the web then they may not be the best choice.
High approval rating- The more approved loans they have given out, the better your chances are of being approved for an online car title loan. This is because companies with a high rating have proven to be reliable among other borrowers in the past.
Honesty- Make sure the company is completely upfront with its fees and interest rates. If you feel like there are hidden costs or that they aren’t being completely honest about how much it will cost you, then stay away. This may mean there are better loan options elsewhere.
How Does The Process Work?
There are many steps involved in applying for an online car title loan. The first thing you will need to do is make sure you meet all of the requirements above, including having a valid bank account where the money can be sent each month.
Once you are approved for an online car title loan, your lender will conduct a check on your credit to find out if you have any recent bankruptcies, missed payments, or judgments.
Next, you will receive an email confirming your loan information including the interest rate and fees that will apply to your car title loan. This contract should be easy to read because all of the terms are laid out for you so it’s basic reading comprehension. The lender may also send you a physical copy via mail as well.
Once the paperwork is signed and sent back, whether it’s by email or regular mail, you will get your car title loan funds within 24 hours. The money can be deposited directly into your bank account or you may receive a paper check in the mail that must be cashed within seven days of being issued.
What Will Happen If You Can’t Pay Back The Money?
If you are unable to pay back your car title loan, the lender will try contacting you through phone calls and email. If they cannot reach you within a certain amount of time, usually 14 days or so, then they will send the loan to collections.
If you are able to pay back your car title loan but it is late, meaning less than 30 days since the due date, then expect to be hit with a late fee on top of any interest or other fees that were already tacked onto the loan total.
In conclusion, online title loans are a quick and easy way to get cash when you need it. Just be sure to compare your options before applying so you know you are getting the best deal possible. With this information, you should be able to get a loan fast.