There are several reasons why you may need to have a huge amount of cash immediately. However, it is often the case that for you to be able to borrow a significant sum from any lender, you need to provide certain collateral or property that the lender can hold as a guarantee that you will pay back what you owe.
More often than not, your car is the viable option when it comes to what you can offer as collateral.
What is a Car Title Loan?
Getting a loan against your car is also known as a car title loan. However, to take a loan out against your car, you need to have sufficient equity in your vehicle. This means that as much as possible, you should have already paid off the other loans that you obtained to purchase your vehicle.
Nevertheless, there are still lenders that allow you to borrow even if you still have a remaining balance.
How Much Can You Borrow?
Generally, the amount that you are approved depends on the value of your vehicle or the equity that you have in your car. As a general rule of thumb, the greater the value of your vehicle, then the bigger the loan amount you can receive.
However, it is most likely that you won’t be able to get an amount that is equal to the full value of your vehicle. This is because lenders tend to only grant an amount that will make it easy for them to get their money back should they need to repossess and sell your vehicle in the future.
Car title loans are usually considered as short title loans, which means that you need to pay back what you owe over a short period. Nevertheless, you have the option of extending your loan by rolling it over. But when you do so, you need to pay new loan fees, which can prove to be pretty expensive.
Benefits of a Car Title Loan
While it is true that a car title loan may be a more expensive option when it comes to getting the cash that you need immediately, there are numerous benefits that you can get from it. One of these is the fast approval turnaround time as long as you are qualified and you have all the requirements.
Thus, you will have the cash you need when you need it and spend it for your intended purpose. Since this is also a short term loan, you will have the opportunity to get out of debt in no time.
In conclusion, there is a great possibility that you can get a loan against your car, particularly if you need a big amount of cash immediately. Just keep in mind that like with any other loans, you still need to pay for the interest and other fees that come with a loan against your car.
Alongside this, also remember that there are still numerous other options for you to get the cash that you need aside from getting a loan against your car.