Bank Loans Versus
Auto Title Loan
Which Loans are right for you?
When you need to borrow money, there are a few alternatives. You could turn to your family and friends, but many times they are struggling as much as you are to meet their financial obligations. There are traditional bank loans and then there are other types of short-term loans like a car title loan. Most people probably do not understand the difference between the two. While similar, they do have their differences.
A traditional bank loan requires going to a financial institution bank or credit union. First applications and then providing documentation that is needed to process the loan. Typically,a borrower will be asked for things such as employment history,credit history,and other background information. The lending institution will then begin a lengthy process of examining the credit worthiness of the borrower. This can take weeks. Eventually,the lender will make a decision as to whether to loan the money or not.
A car title loan is a little different. Although interest is higher it is fast and the loan is short term. Auto Repair Lending of Arizona for example,offers the ability to fill out the application online or at the local branch centrally located. Auto Repair Lending also meets customers at the repair shop, knowing that it is difficult for customers with a car in the shop. Borrowers are asked to verify their identity and residency. They will provide a photo ID and something like a utility bill, in addition to the title of the vehicle. The next step is to make sure the title matches the car or truck and then assess its value. Once the title loan company has an approximate value for the vehicle,they can finish processing the loan. This entire process normally takes just an hour. There are no credit checks or employment verification necessary.
The lender holds the title to the vehicle and if the borrower does not repay the loan, the lender becomes the owner of the car or truck. The loan is not based on the borrower’s ability to repay.
Another difference between traditional bank loans and car title loans is the amount of money borrowed. A car title loan is usually taken out for somewhere between $1,000 and $7,500. Bank loans are usually much higher. A vehicle title loan is great option for someone who doesn’t have a great credit history and who need cash fast