Consider Options Carefully Before Taking Out An Auto Title Loan
An auto title loan is something that should be considered carefully. It can be quick and simple to apply for the loan, but it can be expensive and could potentially cost you your vehicle.
Before taking on an auto title loan, you should consider all your options first. If you have a mortgage, is it possible to refinance and to do it in a timely enough manner. The interest on a mortgage will generally be the lowest rate, however refinancing a mortgage will usually add years to your mortgage or increase your monthly payment.
If you can refinance your mortgage but can't wait for it to be completed, an auto title loan might be a way to cover your financial need until you get the money from refinancing the mortgage. This way, you'll know that you'll be able to pay off the auto title loan on time and it will minimize the extra cost of the auto title loan.
It would be better to use a credit card if you have enough credit available, especially if you know you'll be able to pay it off within 30 days. If you do, you won't have any interest charged. The flip side of this is that you may be tempted to pay minimum payments on a credit card and that could cost you more interest in the long run than if you pay off an auto title loan on time.
The other advantage of a credit card is that it is unsecured, so you don't have to use your car for collateral.
Another option that is sometimes difficult for people to do is to try to borrow from family or friends. You will most likely pay little or no interest, and you probably won't have to put up any type of collateral.
The difficulty with this is the possible hard feelings that could exist between you and the lender if you are unable to pay it off on time. It could lead to financial difficulty for the lender as well. Also, it can be a very humbling experience to have to admit to someone close to you that you are having financial difficulties.
You may want to even consider selling your vehicle to get the money you need. You may very well get more than you need, which you can save for future financial emergencies, and you will save on the cost of gasoline, maintenance and insurance.
If you need the car for commuting to work, you might consider trading it in on a cheaper car. You can use the money you get back to cover your financial emergency, and you'll probably save on insurance. If you go to a smaller vehicle, you will most get better fuel economy as well.
If you want to keep your vehicle and you only need a small amount, you may want to consider a payday loan instead of an auto title loan. A payday loan is generally more expensive and you may not be able to take as long to pay it off, but if the terms work for you, you can avoid putting your car up for collateral for an amount much less than what your car is worth.
Whatever you end up doing, make sure you take the time to consider all the options available for you in your specific situation. You don't want to take on an auto title loan that you'll end up regretting.
About the Author
Approved Money Center offers auto and car title loans that can bring you quick cash in a time of need. We encourage responsible borrowing since these loans carry a quick payoff schedule. Visit http://www.approvedmoneycenter.com to find out more about our cash advance lender practices.
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