Borrowing Against Your Car in Emergency Financial Situations
If you are like most people in the United States, your car is your most valuable asset. Not only does it provide a safe mode of transportation, it can be used as collateral for a loan if you experience money problems.
Securing a traditional loan is easy for customers with a stellar credit history and a FICO score above 650. These people have options because they are viewed by lenders as a good credit risk.
What are your lending options if your credit prevents you from getting a traditional loan and you need money quickly? One thing you can do is borrow money against the value of your car.
Benefits of Borrowing Against Your Car
There are many reasons to use your free and car title to get money for emergency financial situations. In many instances, you will not be subject to a credit check.
Another benefit is you can borrow money quickly. Traditional loans require you to fill out mountains of paperwork and take weeks to get approved. When you borrow money against your car, you can be approved instantly in most cases.
You can borrow up to the fair market value of your car. If your car is worth $20,000, you can have that amount deposited directly into your bank account within a few days.
Emergency Loan Options
If you want to use your car as security for fast cash, you have three options. You can pawn your car, apply for a car title loan or sell your car. Let’s take a closer look at each option.
1. Vehicle pawns are another quick way to get emergency cash. You can pawn boats, jet skis, recreational vehicles, motorcycles, vans and automobiles. Once your car is appraised, you will receive a quote for a loan. When you pawn your car, you have to leave your vehicle with the pawn shop until you repay the loan.
2. Selling your car is a popular way to get a lump sum of money for your car. However, it is not a quick and easy process. It can take weeks (or months) to sell your car. If you need emergency cash this might not be the best solution for you. Here is another thing to consider. After you sell your car, what will you use as your mode of transportation?
3. Title loans are a viable solution for your short-term money problems. You can use your car as collateral, and keep your car. When you apply for a title loan, you instantly find out how much money you can borrow. Title lenders base the amount of your loan on the value of your vehicle. However, some states limit the amount of money you can borrow.
If you want to drive your car while you repay your emergency loan, title loans are an ideal solution. For your convenience, there are online title loan lending options that streamline the process.
Before you sign a contract for any loan, you should conduct research to determine the right path for you.