What Every Mother Should Know about Title Loans, According to City Loan

City Loan, an auto title loan service provider, understands the particular challenges moms face, whether they are single, working mothers or stay-at-home moms in a two-parent household. Sometimes, life with kids can mean financial surprises, whether those surprises are an expensive field trip at school or an unexpected injury on the playground. Even the most financially prepared mom might find herself in need of cash one day.

There are many ways to borrow money, note the team from City Loan, which provides services in Texas, California, Utah, and New Mexico. For example, you can borrow from a friend or family member, apply for a personal loan at a bank, or use a credit card. However, each of those options has a downside. Borrowing from family or friends can strain your relationships. Getting a personal loan often requires a very high credit score and takes a long time to process. A credit card can seem helpful, but also has a long application process and can end up being very expensive, due to interest and fees.

A car title loan, on the other hand, can be a better option for moms who need a small amount of cash quickly. When thinking about getting a title loan, for whatever reason, it’s important to understand the risks and possible rewards.

 

The Process of Getting a Loan

Typically, the loan application process is long and drawn out. You fill out a form at a lender or bank, the lender checks your credit, then decides whether and how much to lend you. Depending on the type of loan you apply for, you might have to put up some amount of collateral.  After a period of time, you’ll receive the loan payment or a credit card to use.

Title loans are different, particularly the loans offered by City Loan. In many cases, you don’t have to undergo a credit check. That means you can still get the money you need, even if you have less than excellent credit. Not having a credit check also means the process of getting the money is much faster. In some cases, you can leave the lender with money in your pocket on the same day you apply. If you apply online, the money can hit your bank account in just 15 minutes.

 

What You Need to Get the Loan

While you don’t have to undergo a credit check to get a title loan, you do need to show the lender some documents before you can be approved. You can either present these documents in person or email them to the lender. Typically, a title loan application requires you to show the lender your ID, a photo of your car, and your car’s title.

There are different types of title loans. Some allow you to continue driving your car as you make payments. Others will store your car for you until you start repaying the loan. Once you begin repayment, you can pick up your car again.


What’s at Stake

No loan is entirely risk-free for either borrower or lender. If the person who borrows money doesn’t repay, the lender is out that much money, plus any interest and fees on the amount.

Car title lenders typically offer a range of payment options, based on your individual needs. Depending on the option you choose, you can end up paying just a few hundred dollars more than the principal of the loan or several thousand dollars more. If you are unable to pay the loan at all, the lender has the right to claim or repossess your car. Since the lender now owns the car, they can sell it to recoup the money that was lent you.

 

Repayment

Repayment is an important part of the title loan process, notes the team at City Loan. The lender wants you to be able to repay the loan as much as you want to pay it off and get your car’s title back. For that reason, many lenders offer flexible repayment terms, up to 36 months. Your repayment plan determines how much you need to pay every month and how much you’ll end up paying back in the end.

In many cases, you have the option of prepaying your loan. If you have the cash to do so, making early payments on the loan will reduce the amount of interest you’ll have to pay in the long run.

To make sure you’re able to pay off the title loan, it’s important to remember to only borrow what you can afford. Many moms turn to title loans when they need a little extra cash to float them until the next payday or to cover an unforeseen expense.

 

What to Look for in a Lender

Not all car title loan lenders are the same. Some have a borrower’s best interests at heart while others just want to make a buck. It’s in your best interests to look out for a lender who’s looking out for you. The professionals at City Loan recommend going to a lender who respects you, promises to treat you honestly, and who will work with you to get your finances back on track.