Car title loan is getting a loan by signing your car to secure that loan. While these loans may get you out of some financial situations specially when you have bad credit history or even don’t have any credit but still I recommend that you don’t get a car title loan. want to know why?
1- High interest rates.
Yes. Some people like credit and some others don’t but no one will be straight forward with you like I did but you just get a high interest rate by getting a car title loan. why would you pay much more the usual interest rate? Don’t solve a problem by creating a bigger one! you have been warned.
2- Fees do add up.
Usually such loans come with a string of high rate fees attached. and once you get a tip of the string it all rolls over and sometimes up to 16% of your loan and even more. When applying for car title loan beware of the hidden fees that the lender may include in the deal like the reprocessing fees which the lender is not legally allowed to charge you for it.
3- Loan rollovers.
Loan rollovers can keep you in dept for long time. the lender depends on the fact that most of the debtors will not be able to payback the loan within the 30 days grace period thus resulting in having interest counting over the original loan for the debtor specially that they focus more on debtors with low income which may not be enough to settle loan payments on time.
