What Is The Definition Of A Title Loan?
If you’re new to the world of loans, then you may just be uncovering the different types of loans and what they entail. For instance, what is the definition of a title loan, and what title loan terms should you know before you apply?
A title loan is a type of secured loan that uses the value of your car title to secure the loan. It’s a way for people who need a good chunk of cash to tide them over the ability to leverage the value in their car as collateral.
There are a number of ways the definition of a title loan can be helpful, but understanding how it works is the first step toward applying sensibly. The rest of this article will cover what a title loan is and what title loan terms are essential to understand.
What Is A Title Loan?
A loan, in its simplest form, is simply an amount of money given from one person to another, with the provision that the money, plus interest, is paid back in regular installments. The same is true of a title loan, except that with a title loan, the loan is secured using the car’s title.
When you sign up for a title loan, the lender will hold onto your vehicle title for the period of the loan. Once the loan is paid in full, the title will be returned to the borrower.
You can still drive your vehicle while making payments, just be sure you stick to the payment schedule outlined in the terms and conditions.
When Should You Get A Title Loan?
Title loans, like all loans, are a short-term solution to help you cover emergency expenses. They should not be a part of your financial strategy in the long term. In the following situations, you might consider getting a car title loan:
- If your car breaks down
- If your home needs an expensive pest control treatment or structural repairs
- If you have unexpected travel expenses
- If you suddenly need hospitalization
When you’re in dire straits with your finances as a result of an emergency, a title loan is a resource you can take advantage of to recover financially.
How Does A Title Loan Compare With Other Types Of Loans
The definition of a title loan is different from other types of loans like an installment loan or payday loan in that it is secured, offers larger amounts of money to borrowers, and usually has a longer repayment period.
So, if you need a large chunk of money to tide you over, then a car title loan might be the right option for you.
What Other Car Title Loan Terms Should You Know?
Now that you understand the definition of a title loan, it’s worth taking a look at some other terms to keep in mind.
Lien-Free
Lien-free simply means that you own your car outright, with no outstanding judgments or debts against its value. If your car title has a lien on it, then you won’t be able to get a title loan until the lien is removed.
To check if you have a lien, you can use the VIN on the vehicle to search it online and see if there are any debts, incurred either by you or a previous owner.
Credit
Credit is another term often used in relation to title loans. Direct lenders will factor your credit into your request. It may affect your eligibility or the terms of your loan should you be approved. Checking your credit score ahead of time might be a prudent step to getting a title loan.
How To Get A Title Loan With Idaho Title Loans, Inc.
If you’re interested in a title loan, then Idaho Title Loans, Inc. has the resources you need. They offer loan amounts up to $15,000, with a quick and simple title loan process that can take as little as 30 minutes. When you apply, make sure you have the following requirements with you:
- Your vehicle for inspection
- Your lien-free car title
- A driver’s license or state-issued ID
Once you’ve submitted a request, a representative will contact you shortly to go over the details and schedule a place for you to meet.
At the meeting, the representative will confirm your info and let you know whether or not you are approved. Should you be approved for the title loan, you can get the cash you need on the same day or the next business day.
Apply Online Today!
Now that you understand the definition of a title loan and other important title loan terms, you’re equipped to qualify without any stress. A title loan can be an invaluable resource in a financial emergency and tide you over with enough money to see you through.
If you’re ready to follow through, then use Idaho Title Loans, Inc. online form to get started today! Our representatives are waiting to assist you with your financial emergency.
Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.