There are times when we are all faced with certain emergencies, and we may need some money immediately. It could be anything from medical emergencies, to house expenses. There could be a situation where one is unable to go to work for a while, and may need some money for a short term.
There are several ways to obtain such loans, and one needs to be a little prepared when it comes to such a situation. First of all, the person who needs money must make sure that they do really need it. This will of course include interest, so the reason has to be very important, if emergency loans need to be taken.
Car title loans are normally given for a period of thirty days. The loan is given based on the title of the car. This can be done with any lender, if the car title is clear of any other loans. Only upon this condition will a lender give money to the borrower. Once the lender has confirmed that the car is free of all loans, he will sanction the amount in no time.
The car title is taken as security when it comes to the loan. The lender has all the rights to take the car, if the loan is not paid back on time. Thus, judging by all this it is wise to avail a loan based on the car, only if it is of the utmost urgency. Otherwise it is not worth taking the risk of losing the car.
The borrower also has to be good enough to plan his finances, and make sure that he can pay back the loan in thirty days. If not, he will face the chance of losing his car. Some of the common people, who take the car title loans, are the ones with bad history, those who have meager income, and possible retired people.
This group of people will have no one else to turn to, and thus become very desperate in times of emergencies. It also has to be remembered that there is a high interest rate on these loans. The interest rates will normally be about twenty five percent of the principal. The loan can however be renewed for another month.
The lender will agree to the renewal, only if the previous month’s interest has been paid. One advantage for the borrowers is that according to the law, the lender cannot ask for more interest rates than those that they have advertised. The borrowers can also cancel the loan within a day, without paying interest.
The lender will have to make sure that he informs the borrower about the rate of interest. He cannot at any cost lure the borrower into paying more than what he is actually supposed to be paying. The car title loans will also be offered only with a certain amount. This is because lenders know that they can charge a certain amount of interest rate only on a certain amount of principal.
The lender will also have to make sure that he is giving money, according to the market price of the car. This is so that if the borrower makes a default in payment, then the lender can at least sell the car and recover his money. The lender cannot take legal action against any borrower, as he is eligible to do so.
This will happen because right at the beginning of the loan application, the lender would have agreed that only the car is the security to the loan. All borrowers must be careful when it comes to borrowing such loans, and must also read all the documents carefully before signing them.
Borrowers must also understand that no lender can renew the loan more than six times, this will mean that the interest will accumulate a lot. So if there is any doubt whatsoever, it is better to consult a lawyer for help.