At one point or another, you’ve probably seen an ad for a title loan. Lenders emphasize how quickly and conveniently you can obtain money, and that you won’t even need to authorize a credit check. For many cash-strapped consumers, title loans seem like the best possible solution to their money woes.
Of course, the adage “if it seems too good to be true, it is” certainly applies when it comes to the title loan industry. Read the fine print on these title loans and you’ll find that the interest rates are extremely high, with the average APR being 300 percent. That means if you get a title loan for $1,000, you’re paying $250 per month in interest. And if you can’t pay off your loan, the lender can repossess and sell your car.
How do these title loan companies stay in business, and exactly how much is that business worth? We took a look at the numbers to find out.
The Worth of the Title Loan Industry
Despite their fees, there is a huge market for title loans, and over 2 million consumers in the United States borrow title loans every year. The average amount of a title loan is $1,000, and borrowers pay an average of $1,200 in total fees for those loans. Add it all up, and title loan companies make approximately $3 billion per year in fees.
The Biggest Players in the Title Loan Game
While there are title loan companies across the nation, three stand out as the largest.
TMX Finance, which is the company behind TitleMax, is the biggest, as it has nearly 1,500 TitleMax stores spread out across 18 states. It also has brands under the names TitleBucks, EquityAuto Loan and InstaLoan, and it employees over 4,300 people. Somewhat ironically, TMX Finance went through loan issues of its own when it was unable to repay $165 million that it borrowed from Merrill Lynch in 2009. That led to a Chapter 11 bankruptcy filing, but the company regrouped and went on to expand quite a bit.
The better you understand the title loan process before you apply, the easier it will be for you to choose the one which best fits your needs concerning loan length, amount, and interest rates. Taking out a car title loan can be a less risky ordeal, in case you borrow from reputable companies which do their best to fit their clients’ standards such as Montana Capital Car, Title Max, and TFC Title loans.
Community Loans of America has many stores around the Southern and Midwest regions of the United States. Its brands include Carolina Payday Loans, Illinois Title Loans and Fast Auto Loans. Across over 200 stores, Community Loans of America employs about 1,800 people. It also hasn’t been without its troubles, in the form of class-action lawsuits alleging predatory lending to members of the U.S. military.
Executives of Community Loans of America branched off in 1998 to create Select Management Resources. Its brands include Atlanta Title Loans, LoanMax and North American Title Loans. The company has approximately 200 stores spread out over 21 states.
The Success of Title Loan Companies
The reason title loan companies make so much money is because of their high interest rates. But why do they charge so much, and why are people willing to pay it?
Title loan companies are able to charge the interest rates they do because they issue loans to people that don’t have many, if any, other options. The vast majority of title loan borrowers have low income and low credit scores, so they’re unable to obtain loans from other lenders, such as banks or credit unions. They also may need money quickly, and a title loan is one of the fastest loan options on the market.
Title loan borrowers typically either don’t realize how much they’re going to end up paying, or they’re getting a title loan as a last resort because they have no other options.
The Future of the Title Loan Industry
Title loan companies have attracted a significant amount of criticism from consumers and lawmakers, and many states have even outlawed title loans entirely or placed heavy restrictions on them. The industry is thriving right now, but it’s very possible for that to change in the future.
Sacramento title loan is one of the fastest, easy and most convenient ways to access cash with just the title of your car which you use as collateral; your credit score is usually not taken into account.
The size of your title loan largely depends on the amount of money you require, the value placed on your car as well as your ability to pay back the loan. A title loan in Sacramento gets you as much cash at the time you need it. We also help you keep your payment manageable.
Our online application makes the process of accessing this loan faster and a lot easier. Soon as you begin the process online, you would just be a step away from getting the cash.
Wondering how you would get a car title loan in Sacramento title loan
With an illustrious history of customer satisfaction, Sacramento title loan has made the process of getting title loans simple and fast. For instance, we accept all sorts of credits so long as our esteemed clients possess a car that has been paid for in full and has a title to show for it; you can get your car title loan approved for you very quickly.
In addition, we understand the value you place on time and for this reason, we specifically tailor the process of accessing this loan to be smooth and efficient. From the beginning up to the end, you would end up spending less than 3o minutes and by this time, you would have the cash you seek. With the Sacramento title loans, you get to go home with the money the very day you apply. We would not make you go through unnecessary twists and bends that would delay the process. Other lenders may do this, but it is not our style. One of our most important missions is to provide the best title loan experience for our clients. Our desire is to be your resource for title loans and that fast cash you need.
Now, why wait when we provide the best option for fast cash? All that is required is that you fill out an online application form and then bring your car, the car’s title, along with government issued identification to your nearest Sacramento title loan location. We would do an appraisal of your vehicle and then determine reasonable transaction amount that is based on your need along with our appraisal of your vehicle.
Once the application is approved, you would get the cash you need while you retain the use of your vehicle. This whole process, as earlier stated takes the duration of 30 minutes. Once you complete servicing the loan, you get back your car title.
Some great benefits of dealing with Sacramento title loans
There are some great benefits that come with getting title loans in Sacramento. These includes:
- Fast approval for title loans.
- Accepts all credit types.
- Simple application process.
- Cash in hand within 30 minutes.
- Needs no car insurance.
- Accepts all makes and models.
- You get to keep your car and continue driving it
- Flexible payment option.
Getting a title loan in Sacramento is a lot faster and easier compared to borrowing cash from other sources. With a title loan you are able to get the cash you need depending on your car value.
Even when you have collected the money, you still get to keep your car for the duration of the loan. You do not need a job, but you need to have some kind of income. Without doubt title loan in Sacramento is one of the fastest ways to get cash.
If you have failed to pay your bills on time, got your credit cards maxed out or had any other payment difficulties, you may now have a poor credit score. This means that you will struggle to get any type of credit until that score has improved. Luckily, there are a few things you can do in order to improve that again.
Understanding a Low FICO Score
There are many reasons why you could have a low credit score. While financial institutions would like to make you feel as if you are a bad person, the reality is that it happens to most people because there was no other way for them to make ends meet. Unfortunately, lenders no longer see customers as people, but rather as numbers. If your number is not high enough, it seems that there is very little you can do.
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Car Title Loans
One option you do have available to you is to apply for title loans in California. This is a secured and short term loan option that is paid out to you very quickly, generally within as little as 24 hours. This means you have the opportunity to meet an unexpected financial obligation and thereby not damaging your credit report any further, as well as being able to rebuild your credit rating somewhat.
How to Rebuild Your Credit Score
There are a number of things you can do to rebuild your credit score. These include:
- View your credit reports with TransUnion, Equifax and Experian. Check whether the entries on there are entries you recognize. If you believe them to be in error, you need to contact both the credit bureau and the creditor and try to have it rectified.
- Pay your credit card debts off. If you have a maxed out credit card, you should try to do a balance transfer or take other actions to lower the amount you owe.
- Do not apply for more loans. The reason for this is that a lender will run a credit check on your file, and this will be left as a trace for as much as three months. Hence, avoid applying for any type of loan that takes your credit score into consideration.
- Stick to your repayments. If you have any outstanding loans, credit cards or other financial products, make sure you make all payments on time. Additionally, this is where you could consider applying for a title loan and using that to show positive financial behavior.
If you decide to take out a car title loan, make sure that you have a plan in place to repay it and stick to it. This will boost your low credit score. After some time of doing this, you may be able to qualify for better financial products once again. Having a low credit score does not mean there are no options out there for you if you are facing a financial emergency. Since your vehicle will be put up as collateral, they are more forgiving of past behavior.