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BlogBlogCar Title Loans – The Good & The Bad

Car Title Loans – The Good & The Bad

ChooseThe housing and debt crisis of the late 2000s left the American economy weaker than it had been in years prior. Thousands of businesses, including banks, failed leaving many wondering how they would borrow should they need to do so. In recent years, the car title loan has become more popular as an alternative to the conventional types of loans offered by traditional financial institutions. Like any loan product, there are pros and cons to obtaining a car title loan. Let’s take a look.

 

The Good

 

  1. A car title loan is easy to obtain and the funds can be acquired very quickly.
  2. A car title loan is secured by a vehicle, which means that there is no need for things like credit reports. Borrowers with poor credit histories can still qualify.
  3. While the vehicle is used as collateral, the borrower still gets to keep and use it.

 

Obtaining a car title loan is pretty easy. To qualify, a borrower needs to own a vehicle that is paid off and has a title free of any liens. If so, the borrower can apply to a car title loan company such as Embassy Loans of Florida. The application takes just a few minutes to fill out and then the lender will begin processing the loan. Embassy Loans, for example, will verify a person’s identity and residency and make sure that the title and the vehicle match.

 

Since the loan is secured by the vehicle, there is no need to run a credit history on a borrower. Some lenders may still do so, but credit is not the primary reason for approving or denying a car title loan. Borrowers with less than outstanding credit can still use a car title loan to borrow money.

 

Once the loan is approved, the lender will possess the title, but the borrower keeps and uses the car. Once the loan is paid off, the borrower will be able to get the title back.

 

The Bad

 

  1. Interest rates are higher than traditional loans.
  2. Borrowers can lose their vehicles if they do not repay the loans.

 

A car title loan is a little more risky than a traditional bank loan and, as a result, comes with a higher price, or interest rate. Borrowers are encouraged to repay their loans as quickly as possible to save on interest payments.

 

Should a borrower fail to meet the repayment terms of the loan, the lender can take possession of the vehicle. The lender will then try to sell the vehicle to recover some or all of its losses.

 

 



Embassy Loans is a leading provider of auto title loans since 2005

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Embassy Loans Inc. is licensed under the “Florida Consumer Finance Act” and as such Embassy Loans is exempt from any licensing requirements under the “Florida Title Loan Act” to the extent that any of Embassy Loans’ activities involve the making of a loan of money to a consumer secured by bailment of a certificate of title to a motor vehicle.

Monthly Interest Rates range from 1.5% to 2.5% (18% to 30% APR), with 15-18 Month Terms.

No Prepayment Penalties!

Embassy Loans uses “Title Loans” for advertisement purposes only and provides auto equity loans. Embassy Loans Inc. is licensed under the “Florida Consumer Finance Act” under Florida Statute 516 and as such Embassy Loans is exempt from any licensing requirements under the “Florida Title Loan Act” to the extent that any of Embassy Loans’ activities involve the making of a loan of money to a consumer secured by bailment of a certificate of title to a motor vehicle.

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Frequently Asked Questions

What is an Auto Equity Loan?

An auto equity loan, sometimes known as a car title loan or a car equity loan, is a type of loan that allows you to borrow money by using your vehicle as collateral. The loan is secured by your vehicle, meaning you agree to use the equity in your car to back the loan. 

What is an Unsecured Personal Loan

An unsecured personal loan is a loan that does not require collateral. Funds are provided based on your credit worthiness and your ability to repay. 

What Is the Credit Builder Program

The credit builder program is designed to help individuals establish or improve their credit score with the primary purpose of building a positive credit history through regular payments.

Can i have more than one Loan at a time?

Embassy Loans can only extend one loan at a time and it’s advisable to start with one and focus on making payments in a timely manner to prevent default.

What happens if I miss a payment?

Missing a payment can have negative consequences, including late fees, a drop in your credit score, and potential default on the loan. Consistent, on-time payments are crucial to benefit from the program.