For years, title loans have bailed many Utahns out with adequate instant cash. While they’ve had their fair share of scrutiny, there’s no denying that many people, especially borrowers with bad credit, consider them a godsend. To minimize the risks of applying for title loans and protect your best interest, utahmoneycenter.com and other experts strongly consider these tips:
Consider Other Options
A title loan must be the loan of last resort. You should only consider it after you’ve exhausted all of your options, which either charge no or less interest. If it’s not possible to borrow cash from your family or friends, explore unsecured loans from your bank or credit card company. When all else fails, only then you should contemplate applying for a title loan. Think of title lenders as providers of financial assistance when nobody’s willing to provide you such.
Think About How Much You Need
A title loan can give you access to a large sum of money. However, it might provide you more than what you actually need. If this is the case, apply for an unsecured loan instead. Using your vehicle’s title as collateral is no joke, which is why you ought to borrow money without security as much as possible.
According to a study, title lenders surprisingly charge a wide range of interest rates. In other words, shopping around makes sense. In fact, some lenders are bent on beating the interest rate offered by their competitors. The status quo gives you the luxury to negotiate for the lowest interest possible, so better make the most of it.
Don’t Sign Until You Understand
The biggest concern of most title loan borrowers is complicated contracts. Fortunately, more lenders are making efforts to explain to people how the deal works. Even if you’re in dire need of cash, don’t sign on the dotted line until you fully understand everything. Make sure you know how much you have to pay, when you need to pay, and what happens if you don’t pay before moving forward.
Much like other debts, title loans can improve your financial standing if you use them right. Exercise your due diligence to work with a reputable lender and make the most of the deal.