What You Should Be Aware of When Taking A Payday or Car Title Loan
Payday loan and car title loans are two popular ways to get quick cash today. With online exposure, millions of people now use Texas car title & payday loan for urgent financial purposes. Undoubtedly, a payday loan or car title provides you extensive benefits especially the speed and convenience. However, many people also misuse and mismanage this kind of loan that brings them more financial problems than the solutions.
These are some things you should be aware of when taking a payday or car title loan.
High Interest Fees
A payday loan typically comes with a higher interest fee than conventional loans. It can have an annual percentage rate(APR) of 300% or 25% of loan amount per month. Let’s say you borrow $100, you’d have to repay $125 on the due date. At this point, you should only take the Texas car title & payday loan amount that you can actually afford based on your monthly salary and other sources of income.
You can slightly reduce the interest fee by taking same day payday loans instead of instant service. Waiting for several hours can save you some interest fees. Whenever possible, ask the lenders for more flexible repayment.
You Can Lose Your Vehicle
Sometimes car title loan is more preferred by car owners as it typically gives a higher loan amount to borrow than a payday loan. The disbursement can go up to 50% of your vehicle equity. The higher equity of your car or the newer models, the higher equity, and the higher loan amount you can borrow.
While it looks legit, you can rollover interest and fees if you fail to repay the loan, even double them. You may not afford these rolled over repayment amounts after several months which could be disastrous. The lender can take your vehicle as you’ve put the title as collateral. Even though your car has a high equity appraisal, take the minimum loan amount.
Short Term Only
Most Texas car title & payday loan are subject to short-term loans only that go around 1-3 months of the repayment period. It’s ideal for quick cash and urgent financing purposes. You would have to repay it within one or two months. That’s why you should only apply for a loan amount that you can afford for your monthly income after subtracted with regular expenditures. However, there are various payday loan offers as you go online, you can get the most suitable loan for your needs.
Payday loans also recognize penalty fees charged when you fail to repay the loan on time. The fees are undoubtedly higher than conventional loans and would roll over as mentioned above. At this point, choose the lender that provides a lower interest, flexible repayment options, and keep the loan amount minimum to ensure your affordability. Some people went on a debt trap as they keep failing to repay their payday loans.
Scams and Fraudsters
The Internet has boosted payday loan popularity and provide wider access for more borrowers to the loans. Today, the internet has been home to thousands of payday loan websites. However, many of these sites are frauds or scams taking advantage of the growing demand of payday loans. They may collect your personal data, require you to provide bank account credentials and ask you to pay administration fees but the loan payment would never come. In the other hand, insecure sites have also become threats for borrowers.
At this point, it’s very important to choose reputable loan providers like LendYou for your payday loan application. Short your list by including state-licensed texas car title & payday loan only to avoid scams and frauds.
Your Financial Situation
Most payday loans would assess your affordability to confront your application. They may reject your application or suggest you with a lower amount of loan. However, you’re the one who knows the very actual condition of your finance. Always consider all factors to assess your actual affordability. Always go on a minimum payday loan amount for paying bills, mortgage, or medical emergency. Treat payday loans as an alternative to the typical financial solutions and avoid taking multiple payday loans at once.
Also You can visit our Homepage for more information and FAQ on Payday Loans Online.