Car title loans. They can have a bad reputation at times, but it is an option that more and more Canadians are considering for some fast cash.
The number of Canadians that have researched this option has nearly tripled since the pandemic.
But, what are the benefits of title loans? Let’s take a look.
What Is a Title Loan?
Auto title loans are when you receive a small amount of cash and in exchange, you give a lender the pink slip to your car.
In Canada, the title loan interest can be as high as 60% of the money you received depending on your background and how long it takes to get it back.
There are certain things that you will need to present to a lender for them to determine the amount that they will give you plus what interest rate they will charge.
This includes a valid ID, details about your car, proof of ownership, proof of insurance, and more. For more extensive information, look for what to know on that link.
What Are the Benefits?
Now that you have an idea of what car title loans are, you can see what the benefits are. These are three of the biggest pros.
No Credit? No Problem
For most loans from a lender, you need to provide a credit report for the lender to more accurately determine how big of a risk you are of not paying them back. But, with a car title loan, NO credit report is required.
If you are not the best with money, or you just do not have the best track record with it, an auto title loan is a very attractive option because it basically provides you with a clean slate and there are no questions asked about your past credit history.
When applying for certain types of loans, you may have to wait days or even over a week for a lender to determine if you will get approved for the loan. Well, with an auto title loan, that waiting time is a lot shorter.
Here, you can get approved before the hour is up. It takes as little as 30 minutes! This ties into the lack of credit report needed, as that saves the time of having to do a background check on you.
Keep Your Car
Perhaps the biggest benefit of them all is the fact that you get to keep your call while you receive your loan.
For most types of collateral situations, you would have to surrender whatever you are putting up, such as a piece of jewelry, until you have the money to pay the loan back.
With this, you can still drive your car and get the money you need! In some cases, this may significantly improve your odds of actually being able to pay the loan back for reasons such as needing the car to go to work.
Consider Car Title Loans
Car title loans do not always have the best reputation in the industry. But, if you need quick money and want to keep your collateral with bad credit, then this may be the option for you.
If you enjoyed this article, read more like this in our Loans & Debts section.