10 Factors to Consider When Choosing a Title Loan Company

97

One of the most effective ways of solving financial problems is taking out a loan. For instance, a title loan could be ideal for you if you need emergency or quick cash. These loans are fast, convenient, and secure sources of short-term funds.

However, finding the right title loan lender can be a daunting task. With myriad options and many factors to consider, it takes time to choose a reliable and trustworthy loan provider. Here are a few factors to consider when choosing a title loan company.

1 – Company experience

Title loans are different from traditional personal loans, so it’s crucial to find a provider with plenty of experience offering them to borrowers. An experienced title loan company will have the right skills, the appropriate tools, and a drive to constantly improve its services to meet customer demands.

By looking out for a title loan-specific provider, you will get an experience tailored to your needs. An established lender is also more likely to be adequately staffed. That will ensure you don’t wait long for your loan request to be addressed. For instance, online loans can be approved within the same business day.  

2 – Reviews and testimonials

Smart and reliable leaders publish genuine reviews and testimonials to advertise their money-lending services. Check out customer reviews and testimonials when searching for a title loan company. You can access these through a quick Google search, and most provider websites have their own reviews and feedback sections.

Browsing through the reviews can give you an idea of other borrowers’ experiences. Avoid taking a title loan from a company that doesn’t offer testimonials. You also want to get title loan quotes so that you can compare rates before making a decision.

3 – Interest rates and loan terms

Since they are short-term loans, title loans typically charge higher interest rates than other consumer financial products. However, you should still shop around for the best interest rates. Try to find the lowest possible interest rates before you settle on a lender. Interest rates are a critical aspect when borrowing any loan, including a title loan, as they can greatly affect your ability to repay the loan.

Besides interest rates, it’s essential to compare terms given by different lenders. Most money lending companies offer online services, making it easier for borrowers to compare a loan’s terms and interest rates.

4 – Flexibility and payment plans

Every title loan provider has their own flexibility when it comes to paying off the loan. Some lenders usually give a versatile payment plan, while others will work with you to develop a custom solution that fits your budget and requirements. 

Ensure you understand the options available before choosing a title loan provider. Inquire about their various payment plans and if they are willing to negotiate on interest rates. By doing that, you are more likely to get a plan that works best for you.

However, you must also be aware of any penalties and hidden fees. Some unscrupulous lenders might burden you with extra charges for paying off your loan early. A lending company may also charge you a fee for paying your title loan in person rather than online or by phone. These fees are usually spelled out in the contract but hidden in the fine print.

5 – Ease of the loan application

If you have decided to get a title loan, you probably need easy and fast money. The best title loan lender offers a simple and quick application process. You will have a much easier time figuring out how to apply for a title loan.

Look for a lending company with a  seamless application process that allows you to complete the whole process online. This will save you the time you would have used filling out forms or commuting to the lender’s physical office to complete the application. Online application is the most straightforward way to apply for a title loan. You can apply from the comfort of your home and get approval or rejection in a minute.    

6 – Privacy and security

Personal information is increasingly becoming vulnerable to theft, so it’s essential to ensure your potential title loan provider takes the necessary measures to protect your data. Look for a lending company that has implemented stringent security protocols and privacy policies. That way, you will rest assured your data is safe.

Be sure to ask how the lender plans to use your data and ensure they comply with all relevant privacy laws. Personal data is too sensitive and should never be left unprotected. Taking precautions now can save you lots of issues in the future. Find another company if you are uncomfortable with a lender’s privacy and security measures.

7 – Customer service and support

Customer service is another essential aspect to consider when choosing a title loan provider. Ensure you look for a loan provider who provides reliable customer service and is willing to respond to all your queries as quickly as possible.

To get an idea of the customer support you can get from a lender, try to speak with an employee from the company directly in person or over the phone. Look for a provider with an established online presence, like a social media page or website, if you are not comfortable speaking directly with a lender. Doing that will give you access to more information about their customer service and support so that you can get an idea of what other customers have experienced with the lender.

8 – Proper credentials

Each state, city or providence has disparate licensing and registration requirements that a title loan provider must comply with when doing business with residents who live there. Ensure the title loan company is properly licensed and insured before submitting an application. 

Avoid doing business with a title loan provider that doesn’t have the right credentials to issue loans in your city or state. To know what your potential title loan provider must have, research your state’s registration and licensing requirements. After that, ask whether they can offer proof of registration and licensing. If a title loan provider is not willing to give this information, that is a red flag.   

9 – Level of borrowing

The level of borrowing you can access from the lending company is also an important factor to look at when selecting a title loan company. While you can generally borrow up to a certain percentage of your car’s value, this can vary from one loan provider to another. Some lenders may offer you up to 70% of your vehicle’s value, while others can offer up to 85%. Be sure to find out the maximum limit of the lender since this will help you determine whether you can increase the amount of cash you require. 

10 – Accepted credit types

Most lenders will check your credit history and score to determine whether you are eligible for a loan. However, you don’t need perfect credit to qualify when it comes to a title loan. You can qualify for a title loan even when you can’t qualify for a traditional loan due to your poor credit score.

Don’t allow your bad credit score to prevent you from getting the cash you require to meet your financial needs. Find a title loan provider who is ready to accept most credit types. 

Endnote

Title loans can be a great option for getting quick cash to solve your financial difficulties. With some lenders, you can get a title loan approved within hours or a day. However, it’s crucial to do in-depth research before signing any loan agreement. A slight mistake can cost you hundreds of dollars at closing or cause unnecessary hassle during the application process and in the future. Consider these factors when choosing your next title loan provider.