How to Get a Loan with a Poor Credit Score
A poor credit score suggests that you may have missed repayments in the past, owe too much money or that you may have a bankruptcy against your name. If any of these is true for you, you may find that obtaining a loan from a conventional source such as a bank will be an uphill task. If you need access to money, however, there are other options to consider, particularly, a car title loan.
What is a car title loan?
With a car title loan, you offer up your car title as collateral for a quick, low-commitment loan. Generally, car title loans can be acquired within 24 hours and have to be repaid within a short term of usually 15-60 days. They can last much longer in some cases, however, depending on the needs of the borrower.
These loans are generally useful for relatively minor expenses, and the loan amount often ranges between 25% and 50% of the car’s value. They are considered subpar, as you can expect to pay around 25% in interest, depending on your loan provider. If you live in the Palmetto Bay area, you should talk to a car title lender to learn what the best car title loans Palmetto Bay opportunities are.
How do you qualify?
Generally, qualification for a car title loan is a straightforward process, as the main requirement is simply to have a car that is valuable enough and a consistent source of income from which to repay your loan.
If you fulfill these requirements, the first step to obtaining a car title loan would be to visit a car title lender. You will be asked to fill out an application form providing basic information about your vehicle, including the year, make, model, current mileage, and any extra features such as a sunroof.
All of these help your lender arrive at an estimated value for your vehicle, which will determine the amount they are willing to loan to you. Knowing the Vehicle Identification Number (VIN) of your car will make it easier to get a more accurate value.
What do you need?
In preparation for the loan, requirements may vary from lender to lender, but they typically include the following:
- A state-issued identification card or valid driver’s license.
- A free and clear car title means the car is owned exclusively by the borrower and is not tied to creditors or third parties that could claim ownership.
- Three personal references who must be unrelated to the borrower.
- A copy of the borrower’s Social Security Card.
- Insurance (not always required).
On approval of the loan, the lender places a lien on the title of the car, but you may keep the car if you have insurance, until your loan is repaid. Car title loans are becoming increasingly popular as a means to obtain cash on short notice, especially for people with poor credit scores. Additionally, the easy and convenient processing time when compared to the lengthy process of getting conventional loans makes them a great option in emergencies.