Why are title loans better financial options than traditional loans?
Whenever you have financial needs, you start tapping into the best financial solutions. The two main options you can make the most of are quick title loans or traditional car loans. It’s time to find out why people only opt for the first option.
Traditional Car Loan Vs. Modern Car Title Loan
You should clarify at this point that both options are classified under a secured loan. You use your car or its title as collateral to get a loan. However, there are certain things that make a quick title loan the best financial choice for a person.
Less paperwork – Consider getting a loan from a traditional channel, i.e. a bank, and you will start to imagine all those documents you need to bring there. Getting a loan with a car title, however, is quite convenient, as you don’t have to organize a lot of paperwork. The first document is the original unlicensed car title and the second document is proof of income. The purpose of obtaining this proof is to understand the debt-to-income ratio. Every lender tries to play it safe. Therefore, he is interested whether you can manage the monthly loan payment or not. You may be surprised to learn that many lenders are willing to give you a loan against your car title, even when you are unemployed.
Loan Approval Speed - Everyone knows the frustration of traditional lending. You will have to wait for weeks to get loan approval even if you meet all the conditions. The bank does not grant loans quickly. They take time, and you have to show some understanding of the ins and outs of the loan approval process. What if you can’t wait that long? In case of immediate cash needs, fast title loans work as great lending solutions for individuals. You can expect to get the loan amount on the same day if you choose the best title loan provider.
No need for co-signers – If you do not have a good credit rating and a good credit score, then you start looking for a consignee, and finding it is not so easy. The bank requires a consignee, so when you cannot pay the loan amount, that person will pay the amount you owe the bank. However, fast title loans do not require a co-signer. The lender relies only on the collateral in case of risk of default.
No more credit checks – In a traditional loan, your creditworthiness plays a central role. The bank will perform a credit check to get an idea of your credit score. Your creditworthiness will decide whether the car loan will be approved or not. Contrary to this, fast securities lending do not require a credit check. They have little or no impact on your score and credit rating. Regardless of your credit score, a lender is there to help. This means that your bad credit will not be an obstacle for you.
People opt for fast title loans because they can avoid the hassle of traditional loans. There is no need to go through the loan approval anxiety of waiting to receive a loan approval call from a conventional lender.