Use Your Car to Get Out of Debt

Use Your Car to Get Out of Debt

Having bill collectors call you all hours of the day is stressful and if you can’t find the money to pay them back they can get pretty nasty.  You do have one last option that is available to you…your car.  How does that work?  You can secure a loan based on the title of your car and get those bill collectors off your back.  Yes, you can use your car to get out of debt.

How Does this Work?

If you own a car that is already paid off then the whole process is pretty simple and fast.  Essentially the lender gives you money and as security you are going to give him the title to your car.  There are lots of companies that specialize in auto financing that can offer you easy approval online.  They use the internet to help as many people like you as possible.  Most of their sites are already set up with the right software that will show you right away what your car is worth and how much you can get a loan for.  Here is an overview of how they work.

The Fine Print

First of all you need to understand that this is a very short term loan.  The lender is far more interested in the value of your vehicle than they are your FICO score and they may want to see that you have adequate car insurance.  Given all that there are 3 things that will affect the amount of your loan:

  1. The amount of cash you’re looking for
  2. The value of your car
  3. How will you repay the loan (do you have an income)

Auto Pawn Loan or Car Title Loan

There is a pretty big difference between the two.  If you want a pawn car loan you’re going to have to give your car along with the title to the pawnbroker.  The car itself is going to stand as security.  You can get more cash but you won’t have your car. title loans st joseph mo offer a little less cash but while you’re repaying the loan you can keep your car.

If You Can’t Repay the Loan

If you can’t pay back the car title loan Albuquerque then you face the very real possibility of losing your car.  Before that happens though talk to your lender and see if you can extend your loan for one more month with a process that is referred to as “rolling over” your title loan.   If you still can’t repay the loan then the lender will take your car.  You need to remember this is a short term solution and this needs to be paid off within the time frame.

A car title loan is not for everyone but it will offer you money when you have absolutely no other alternative.  Always make a plan to guarantee that you make the payments on time.