Vehicle title loans is similar to payday loans in many aspects. For instance a borrower in need of cash could obtain a loan without a credit check. No tests are applied to figure out if the borrower has the means to repay the said loan. Another similarity is the location of the outlets or service providers that offer this type of lending scheme. A typical payday loan can be found in retail stores supermarkets and other commercial establishments frequented by a large number of people.
The typical way to obtain this loan is to use the title of a vehicle and use it as a form of security pledge. The borrower has to sign legal documents to show that the title of the vehicle has been turned over to the lender in order to secure the loan. Most of the time the borrower also needs to give a copy of the car key. It is therefore important that borrowers develop a strategy to repay the loan because the lender can repossess the vehicle. Some information can be found at this website.
It has to be pointed out that a title is an official document and therefore the borrower must be careful in handling this type of document. It is important because it proves ownership over a particular asset. In this case it proves ownership over a car motorboat truck and even luxurious mechanical transporters.
A vehicle title loan is not limited to cars. A consumer interested to secure this type of loan could utilize titles on a truck an SUV boat or even a recreational vehicle. The amount of cash that could be borrowed is based on a percentage of the value of the vehicle.
The terms of the loan provides contrast to that of a payday loan because a payday loan has to be paid after two weeks or the following payday. However in a vehicle title loan the process of repayment involves a 30-day term. The interest rates vary depending on the location of the service provider because different states have different interest rates. Aside from the interest rates that lenders charge the borrower there is also the processing fee that borrowers need to consider.
Needless to say a car title loan is different from a payday loan in another aspect because a payday loan is an unsecured loan. A payday loan does not need a collateral before the loan amount could be released to the borrower. On the other hand a car title loan is a type of secured credit. There are a number of lenders who may require the vehicle to be protected through insurance. The good thing about the secured credit is that borrowers could negotiate for better rates as compared to payday loans. Nevertheless lenders can impose a strict standard and will determine if the title is free from administrative or judicial restrictions before money is released to the borrower.
It has to be made clear that the lender is given the right to hold the title of the property until the borrower is able to clear the loan. Aside from the due diligence required to verify the collateral the lender also verifies the borrower’s capability to honor his or her obligations. If looking for this type of loan in San Antonio use the web browser’s search capability and type the following search term: title loans san antonio.