Having equity in your vehicle is like having money in the bank. When an unexpected expense occurs, you have the option of tapping into your auto equity to get a quick cash loan.
The reality is multiple financial emergencies can happen at one time. If a previous financial emergency has wiped out your savings account, what are you going to do?
In many instances, people experience financial problems that are not their fault. Car repairs, medical bills and roof repairs can deplete your savings account.
At South Orlando Title Loans, we've helped customers through all sorts of financial predicaments. If they didn't have equity in their automobiles, they may not have been able to withstand the financial setbacks.
An auto equity loan is a type of secured loan. With this type of loan, your vehicle is used as collateral to guarantee the loan. Title loans are examples of auto equity loans.
Once you receive an approval decision for your auto equity loan, you will sign a contract with your lender. After you sign the loan contract, you'll be legally required to abide by the terms of the contract.
If your contract states that your installment is due on a particular date, you'll have to pay it exactly on that date. Your contract will also provide details about late fees, interest rates and the total cost of the loan.
To calculate the equity that you have in your vehicle, you'll have to subtract the amount that you owe from the value of your car. If the value of your vehicle is more than the amount that you owe, you have equity in the vehicle. If it's less, you don't have equity in your car.
Here's an example. The value of Steve's vehicle is $5,000. He owes $500 for a title loan. This means that Steve has $4500 of equity in his vehicle.
When you apply for an auto equity loan, you may not qualify for a loan if you owe your original lender or title lender for a loan. Depending on the lender, it's likely that you'll be required to have a lien-free title for your vehicle in order to qualify.
An auto lender places a lien on your vehicle after you enter into a loan agreement. This loan is registered at the motor vehicles department in your state of residence.
The motor vehicles department records the lien at the office. The lender's name is recorded on the title as the lien holder.
After you have paid the lender the entire amount that is due to satisfy the loan, you are eligible to have the lien released. To release the lien, you'll have to provide the verification that your financial obligations have been fulfilled.
Once the department of motor vehicles verifies this information, the lien will be released. You will be the proud owner of a vehicle with a lien-free title.
Auto equity loans are often the easiest types of loans for customers to get. They don't require credit checks. This is good news for people who are challenged by credit problems.
Another reason people select an auto equity loan is it doesn't take long to get approved for the loan and get their money. Many people who apply for this type of loan need cash in a hurry.
Some people enjoy the fact that they can get an auto equity loan without giving up their cars. All of these benefits make auto equity loans attractive options for millions of customers in the United States each year.
While it's true that title loans have been a source of quick cash for lots of people, you should carefully consider whether this type of loan is right for you. To determine if an auto equity loan is suitable for your situation, consider the following questions.
Do you have a short-term financial need? Auto equity loans are good loans for people who are having short-term financial problems.
Can you afford to repay the loan? If your income doesn't support an additional bill, this loan might not be a good fit for you.
Auto equity loans can be a good source of quick funds when you need it. Now that you know all about this type of loan, you can apply for one with confidence.