A title loan is a type of secured short-term loan offered by financial institutions where a car is used as the collateral. A title loan will assist you to get a few dollars that you may need to cater to short term expenses and it is therefore easy and convenient to apply. After the necessary credit checks are done and the car title is considered clean, the necessary documentation are submitted and the loan is processed very quickly.
However, the following are crucial things that should be considered before applying for a title loan in Los Angeles:
- PAST CREDIT RECORD
Before approaching any financial institution for a Title Loan, ensure your credit rating is adequate, as this will affect the response you will get and/or the interest rate that you will be charged. A good credit rating will equip you with negotiation capabilities and reward you with special terms and low interest rate. However, there are many title loan companies in Los Angeles that do not require a credit check. The Cali Loan Company is a good example of one of these companies.
- CONSIDER OTHER ALTERNATIVES
Title Loans are expensive and it is wise to consider other sources of money where the interest rate may be very low or none. Alternatives like credit cards, pay advances from employer, family, friends and other financial aid institutions could be the best bet.
- REQUIRED DOCUMENTATION
A must have is proof of regular cash flow which is a guarantee to the lender that the loan shall be repaid accordingly. Main requirement would be Pay Stubs (mostly for the last 6 months) and a checking account which must be provided. This assures the lender that you have a stable job or a profitable business that is able to support your loan repayment plan.
- INTEREST RATES AND APPLICATION FEES
It is important to compare the interest rates and fees being charged by various title loan providers in Los Angeles. A good research should be carried out to enable the borrower get the best provider with the lowest interest rate and reasonable application fees.
- REFER TO BETTER BUSINESS BUREAU
Some lenders in Los Angeles may not be genuine and it is therefore important to check with BBB for authenticity of the lending institution. This will ensure you do not offer your car as security to scammers who give vague terms and conditions and finally repossess your car unreasonably. Companies with good accreditation and work ethics should are obviously the most preferred.
- ADMINISTRATION FEES
Title loans in Los Angeles may have various fees attached to them. Ensure you understand each and every statement, term and condition. Ask relevant questions regarding the loan. It should be noted that due to the strict regulations which govern the fees being charged by financial institutions, most of them tack on certain fees that may not be obvious to the borrower.
The providers of Title Loan in Los Angeles have attractive advertisements that lure most borrowers. Whilst these loans can save you from financial crisis, it is important to keep in mind that the car will be repossessed if default on the loan payment occurs. Other penalty fees like late repayments may also apply. It is imperative therefore to exercise great caution and consider the above points before applying for a title loan in Los Angeles.
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