CAR TITLE LOANS
Lots of concern has spread in regard to auto title loans which are a loan backed by an auto title and possible an extra set of keys. It's a convenient way for borrowers to get money fast without a line of credit, but the loans can carry an interest rate of up to 300% or more. Title lending is lesser-known when compared to payday loans or a high-cost mortgage. Title loans are also competition for the bank. As a matter of fact, the title loan industry booms in areas where no banks are located. So how do you go about balancing the weight of a fast, convenient loan to the extraordinary high interest rate? This article aims to present the reader with information relating to the positives and negatives of this industry.
This is currently legislation going on in many states that would call for stringent laws to rule over the auto title loan industry. As you read this there are lobbyists who represent these companies that are working to ward off the laws. Earlier this year President Bush signed a law placing a 36% annual cap on high cost lending to the military. Some believe that is a start but that there is much more work to do. For the most part small loans are regulated by state and local governments. Right now, auto title lenders operate in about half of the states.
Now let's think for the moment of someone who just got into a car accident. They need money to pay the bills but have no savings, no family to ask for help, and no line of credit for a loan from the bank. This person needs money fast and therefore decides to get an auto title loan by putting their car up as collateral (assuming the car is not damaged too much from the accident), but after a while they no longer able to make the monthly payment and after the balance, fees, and interest carries over from month to month enough times their car is repossessed. Now they are injured, have no money, no car, and a huge debt hanging over their head. At this point they are no longer sliding down the downward spiral but have fallen off completely.
So, what is it that this person could have done? Well some money in a savings account for a rainy day would have been nice. Having a friend or family member to contact in a state of emergency would help as well. I guess it would depend on what degree of security you require. The best thing would be to have really good insurance and some savings to cover any deductibles.
Bеfоrе you аррlу fоr an car title lоаn, уоu ѕhоuld еѕtіmаtе thе whоlеѕаlе vаluе of уоur uѕеd саr fоr уоurѕеlf. Thе Kеllеу Blue Bооk (KBB) іѕ a рорulаr rеѕоurсе tо dеtеrmіnе a used car's vаluе. Thіѕ rеѕеаrсh tооl lеtѕ уоu ѕеаrсh for уоur саr'ѕ mаkе, mоdеl аnd уеаr аѕ wеll аѕ аdd thе аррrорrіаtе орtіоnѕ tо gеt the vеhісlе'ѕ vаluе. Thе trаdе-іn vаluе (ѕоmеtіmе еԛuаl tо thе wholesale value оf thе vеhісlе) wіll bе thе mоѕt іnѕtruсtіvе vаluе whеn аррrоасhіng a lеndеr bесаuѕе thеу wіll fасtоr іn thіѕ саlсulаtіоn tо dеtеrmіnе hоw muсh thеу саn аffоrd to lеnd you. Eѕtіmаtіng уоur vеhісlе'ѕ wоrth wіll help уоu ensure thаt you саn bоrrоw thе mаxіmum аmоunt роѕѕіblе оn уоur саr еԛuіtу.
In conclusion, it is my belief that there is nothing wrong with this type of service. I believe we need to make rational decisions on our own and not rely on making a new law every time people get irresponsible. Use the service knowing for certain you will have the money to pay it back in time and develop a plan to avoid this type of problem in the future.