The Pros and Cons of Auto Title Loans, Courtesy of Phoenix Title Loans
You love your vehicle. Every time you get behind the wheel and drive, you feel the adrenaline rush; it’s a sense of entitlement and empowerment. But you may not realize you can also be entitled and empowered to get money from their vehicle to cover expenses. That’s where title loans come in. But title loans may not be for everyone, so we at Phoenix Title Loans with to inform customers the Pros and Cons of Auto title Loans, Courtesy of Phoenix Title Loans!
The Pros of Auto Title Loans (No Credit Check)
One of the most beneficial pros of auto title loans is that Credit Checks are NOT Required. Not every customer is going to have good or perfect credit. Most cases, people have fair, poor, or bad credit. Some have no credit at all. Most financial institutions frown on these customers and will not serve them in terms of a loan. That is not the case with an auto title loan. The only major qualifier for an auto title loan is the car itself. If you HAVE a car and title, you have a loan ready to go! To use Phoenix Title Loans as an example, we have accepted a multitude of vehicles that have come across our path. We accepted cars, trucks, SUVs, motorcycles, scooters (NON-RIDE SHARE), even a HELICOPTER!
Additional Pro of Auto Title Loans (Easy to Get)
Another Pro for auto title loans is ease of access to getting the loan. Traditional loans require multiple items; driver’s license, social security, birth certificate, proof of income, proof of insurance, proof of purchase from a cereal box, passport, mother’s maiden name, first-born child, etc. The process gets so bogged down by paperwork it almost seems impossible to get a loan. And when you DO, it could take several hours to even DAYS getting the money. Fortunately, auto title loans are simple in getting access to the money. Going back to us again, we usually require an Arizona State-Issued Driver’s License, the vehicle, the Vehicle’s title, and (depending on amount requested) Proof of Insurance. There are other factors as well, but those are reviewed via case-by-case.
The Pros of Auto Title Loans (Most Cases You Can Still Drive)
There are many that believe having an auto title loan means you can’t drive your vehicle while the loan is in effect. Phoenix Title Loans cannot speak for other title loan businesses, but we are more than willing to allow customers to keep driving their own cars provided they inform us of their reason. Also keep in mind, we may request holding onto it if the loan amount requested is past a certain point. In that case, think of us keeping the vehicle as a means to protect your investment with us.
The Cons of Title Loans
While we would love to gloss over this aspect, to get the full weight of what auto title loans are, we must discuss the Cons along with the Pros.
The Cons of Title Loans (Short Term Benefits)
Remember, the purpose of auto title loans isn’t to be a new income stream, rather, to act as a Short-Term solution. While few and far between, we have had customers in the past continue to pay their loans for years after the initial payout; being five to seven years at the latest. Most cases, auto title loans best work during transitional periods between jobs/careers and as supplemental means. If you are planning to make title loans your only source of income, we strongly recommend stepping up the efforts of gainful employment.
Another Con of Auto Title Loans (Dependency of Car)
As stated earlier, a customer’s credit is not the determining factor. The customer’s VEHICLE is. Why is this considered a ‘con’ then? Age and damage. As vehicle owners are well aware, a vehicle’s overall value (unless qualified as ‘historic’) depreciates. An old adage goes that as soon as you drive a new car off the lot, it’s downhill from there. This is true of customers requesting large loans on older vehicles. There is a rough workaround; if the vehicle is in pristine condition and is not too old, then it’s possible to still get a decent loan-to-value amount.
A Con of ANY Loan (Loan Must be Paid Back, or Repos happen)
Let’s be honest, if customers could walk away from any loan without repayment they would without hesitation; which is fair. However, as this is a loan, it must be repaid. Before the money we offer is exchanged, we make sure customers are aware of how long it would take to pay back the loan. We wouldn’t want customers to remain in perpetual payment cycles. Also, we DO inform them that should the worst happen, we would use their vehicle as collateral to pay off the remaining debt in the form of a repossession. INFORM US OF ANY ISSUES YOU MAY HAVE TO PREVENT THIS FROM COMING TO PASS, but understand that failure to make payments or defaulting will causes this outcome to pass.
How Phoenix Title Loans Separates from the Pack
This is a commonly asked question among residents in the Valley of the Sun. We proudly answer them with this: We are a Local Business, Serving Local Customers. That makes us approachable when dealing with questions and concerns that arise before, during, and after the exchange of money is handled. We also have a host of flexible options, from the types of vehicles we can and have taken, to refinancing and buy out options.
Finally, above all, we have staying power thanks to being faithful to our Valley customers for the past decade and beyond. Many title loan companies have folded during our time in business, so in order for us to not end up the same way, we had to be customer-centric and focused on providing quality loans, services and be at ideal locations. That is the difference when dealing with a title loan company, and receiving service from Phoenix Title Loans.
Image: Hand holding a car from Philip Silver/Shutterstock