The Differences between Car Title Loans, Personal, and Payday Loans
In the world of short-term loans, many people are unaware of the differences between various types of loans. Personal loans, car title loans, and payday loans each have their advantages and disadvantages. People seeking emergency cash solutions often don’t take the time to fully understand how these loans differ.
Personal Loans
There are different types of personal loans, but most fall into one of two categories: personal loans from traditional lenders like banks, and no credit check personal loans offered by other lenders.
When you borrow money from your bank, you undergo a credit assessment to determine if you are a good candidate to repay the loan. If the bank approves, you receive the loan; if not, you may need to explore other options.
No credit check personal loans are available, but these usually come from non-traditional lenders. Such lenders may not follow the strict rules that apply to banks and can charge very high interest rates, making these loans closer to cash advances.
Payday Loans
To get a payday loan, you must have a job and a steady income. You write a personal check for the loan amount plus fees, and the lender gives you the money quickly, often within an hour. The lender holds the check until the loan is due. You can either pay off the loan or extend it, but extensions come with additional fees.
Payday loans don’t require a credit check, and they can be a fast way to borrow a few hundred dollars. However, the fees can add up quickly if the loan is extended.
Car Title Loans
Car title loans are secured by your vehicle. Most lenders, including Embassy Loans, prefer the vehicle to be 15 years old or newer and in good condition. You must have the title, and the vehicle should ideally be fully paid off. Although some lenders may allow loans on vehicles with outstanding loans, owning your vehicle outright is preferred.
Like payday loans, car title loans don’t rely on credit checks. If a borrower fails to repay, the lender can take possession of the vehicle and sell it to recover losses. For those needing quick cash, Embassy Loans can process car title loans and provide funds within an hour.
Apply online or contact 833-839-2274 today to learn more about car title loans and other emergency loan options.
