Buying A Car Or Getting A Car Title Loan? There"s A Difference
Although the words may sound similar, a car loan is not the same as a car title loan. With the plethora of loans out there these days, it's important that consumers know the difference. Especially when looking online for a lender.
When shopping for a loan, have your loan options in order. Financing any type of loan means doing your homework in advance in an effort to get a better loan. Annual interest rates (APR), payment options, balloon payments and other loan related issues play a large part in the loan process. Arming yourself with the proper information before you make a decision and sign on the dotted line is important to making sure you get the best loan possible.
Although many people finance through the dealer that they buy the car from, it is often times better to get financing from your bank or credit union before you go to pick out a car. Traditional lending institutions tend to offer better interest rates and loan terms. In the event that you enter into a financing contract with the dealer, you may be able to get a special finance rate based on your credit score. Car dealerships often offer specials deals on certain cars for those consumers who have outstanding credit. Be careful, though, because the dealer may make it look like you are getting a great deal while the fine print states otherwise.
Auto loans are usually from 36-60 months with the consumer making the payment to the lender on a monthly basis. Often times the dealer will "sell off" the loan to a bank or other financial lending institution in which you will make your payments. You will pay interest based on the entirety of the loan but if you pay off your loan early, you will not be charged the interest you would have accrued in the full length of the loan term.
A car title loan is different than an auto loan. It is a short-term loan that is usually paid back within three months. The interest you pay depends on how much you borrow and how quickly you pay it off. As with an auto loan, should you pay off your loan early, you will save money on interest. If you cannot pay off your loan in the amount of time that the lender gives you, you will be charged high fees. Many auto title loan lenders will work with you to make payment arrangements in this case. If you can't make your payment at all, it is imperative that you let the lender know since they usually take it directly from your bank account.
A car title loan is meant to be for short-term purposes. This type of loan is great for those who are trying to bridge the gap between finances or take care of unexpected financial emergencies. They are not meant for people whose budgets do not allow them pay the loan back in the intended amount of time.
When shopping for a loan, have your loan options in order. Financing any type of loan means doing your homework in advance in an effort to get a better loan. Annual interest rates (APR), payment options, balloon payments and other loan related issues play a large part in the loan process. Arming yourself with the proper information before you make a decision and sign on the dotted line is important to making sure you get the best loan possible.
Although many people finance through the dealer that they buy the car from, it is often times better to get financing from your bank or credit union before you go to pick out a car. Traditional lending institutions tend to offer better interest rates and loan terms. In the event that you enter into a financing contract with the dealer, you may be able to get a special finance rate based on your credit score. Car dealerships often offer specials deals on certain cars for those consumers who have outstanding credit. Be careful, though, because the dealer may make it look like you are getting a great deal while the fine print states otherwise.
Auto loans are usually from 36-60 months with the consumer making the payment to the lender on a monthly basis. Often times the dealer will "sell off" the loan to a bank or other financial lending institution in which you will make your payments. You will pay interest based on the entirety of the loan but if you pay off your loan early, you will not be charged the interest you would have accrued in the full length of the loan term.
A car title loan is different than an auto loan. It is a short-term loan that is usually paid back within three months. The interest you pay depends on how much you borrow and how quickly you pay it off. As with an auto loan, should you pay off your loan early, you will save money on interest. If you cannot pay off your loan in the amount of time that the lender gives you, you will be charged high fees. Many auto title loan lenders will work with you to make payment arrangements in this case. If you can't make your payment at all, it is imperative that you let the lender know since they usually take it directly from your bank account.
A car title loan is meant to be for short-term purposes. This type of loan is great for those who are trying to bridge the gap between finances or take care of unexpected financial emergencies. They are not meant for people whose budgets do not allow them pay the loan back in the intended amount of time.
