Getting a car title loan should not be something you just jump into. You should only get a title loan if you have investigated and exhausted all other viable alternatives. Once you decide that working with a car title loan lender is in your best interest you'll then need to be sure you know what you're doing. Car title loans should be easy to understand but many online lenders make things a lot more complicated than they need to be. Some lenders who provide car title loans will add fees and interest if they think you don't know what you're doing. If you take out an online title loan under the wrong circumstance you may find yourself in a situation that you can't dig yourself out of. The number one recommendation that we make to people that are considering car title loans is to slow down and make every decision very carefully. Let's get right into it and break down what we see are the biggest mistakes people make when they're shopping for title loans online.
Don't make the mistake of doing zero research
You may think you know what a title loan is. You may think you absolutely need a title loan and that there's no alternative. Fact of that matter is that this may not be correct. The only way you'll know for sure is to do research, You not only want to do research on the type of title loan you're interested in, but also on the lender that wants to provide you with that car title loan. It should be no different than if you were investigating a car lender or mortgage broker. Just because you may have bad credit and limited options it doesn't mean you can't investigate what you're getting yourself into. Take a few hours and do some searching online for comparison quotes as well as real feedback from consumers and online watchdog sites. You also need to check with your state regulatory site to make sure your lender is following all necessary restrictions.
Don't think a title loan is your only option
This is critical in determining whether you make the right financial decision. Car title loans should probably be your last recourse when you're looking into financial or credit options to get cash quickly. You really need to do all you can to avoid the high fees and heavy interest charges that are associated with online title loans. Try to get a bank loan, borrow money from a friend, or take a second job if possible. Online title loans definitely serve a purpose on the financial ladder, but they should only be used as a last resort when you need same-day cash, have bad credit and have exhausted all other financial options.
Don't sign up with the first title lender you come across
Much like if you were buying a vehicle, you want to compare and contrast quotes from multiple online car title loan companies. Sure this may take more time, but you'd be surprised how much you can save if you find a title lender that's licensed in your state and charging interest and fees that are in line with your state requirements. One problem we see all too often is people that don't know what the normal fees and rates are with title loan lenders. They'll sign up and be approved with the first title lender they come across. Ultimately though, they'll end up paying hundreds of dollars more than they should have over the life of the loan if they went with a better priced lender. Don't be that person! Do your research on car title loans, take your time and be sure you've tried all other financial options!