Did you know that you can use your vehicle to access immediate funds for whatever you might need it for? There are many advantages to taking out an auto equity title loan in Alberta. A title loan is when you give the title of your vehicle over to a lender with the promise to return your loan within the terms. Your vehicle is used as collateral for your ability to use the money given to you for emergencies, business opportunities, down payments towards another loan, furthering your education, and so much more.
Today we will be reviewing some of the big advantages of how you can leverage an auto equity loan in Alberta.
Do you need a credit check or a good credit score to take out a car title loan?
The short answer for both is, no, you do not need good credit or need a credit check for you to take advantage of your car title loan. If you want to take out a title loan, all you need is a clear title on your vehicle and own your vehicle. Your credit score and a credit check is not even a question for you to access funds. At Cash Loans Alberta, simply show you own your vehicle and that you have nothing owing to the title of your vehicle with any lenders, and you will be good to go.
Can you use a car title loan for a down payment?
When you go to make a down payment on something such as a new car and get a loan from another lender to secure the rest of the funds, the larger the down payment, the less your monthly payments. When you apply for a new loan, the banks will take your down payment towards a loan as a sign of responsibility and reward larger down payments with better terms and interest rates.
Do you want to use your car title loan for an emergency?
Many others have been in a tight spot and need to secure some cash to get out of a situation where they might owe someone or need to catch up on some bills. When this happens, you might have just started a new job or know some secure funds will be received soon. A car title loan is the perfect thing to fill that gap until you can get back on your feet.
Did you know you can pay your car title loan off early without penalty?
When you get a loan, it could come with terms that do not allow you to pay the loan off early. With car title loans in Alberta, most lenders will allow you to pay your loan off early to avoid paying the higher interest rates that come with the monthly payments on a title equity loan.
The Pros and Cons for an 84 Month Auto Equity Loan
While obtaining an auto loan can seem like a godsend if you’re strapped for cash, it’s always important to know your downside risk. With that said, there are both pros and cons that you need to consider when it comes to taking out an 84 month auto equity loan.
Here are some of the pros and cons that you should ponder:
The pros of an 84 month car loan
- Reduced interest rates – A longer car loan will typically have a reduced interest rate relative to a shorter one. But as you pay off that interest for longer periods of time, it’s not always going to be more economical than a shorter loan.
- You can borrow more – A longer auto loan term entails a reduced monthly payment. This could be turned into more money by the month’s end or you can simply borrow more.
- Reduced monthly payments – As previously stated, a longer car loan entails a reduction in monthly payments. As such, you’ll have to balance the lengthier periods of interest with the advantage of reduced monthly payments. But if done right, it could work out quite well for you.
The cons of an 84 month car loan
- Longer negative equity period – Based on your down payment, in the first couple of months of a car loan, you will be in negative equity. This entails you owe more than the actual value of the car for that period.
- Longer period of interest – Even though 84 month car equity loans are typically at a low rate, you’ll be paying that rate for longer than a conventional loan. That might work for your circumstance or it might not. Regardless, you should assess the interest payable for the term and contrast it with a typical auto loan prior to signing anything.
When it comes to a short or long term loan, the best choice is really based on personal circumstance. Choosing a short term auto equity loan means less interest and less risk. As a result, a short term loan minimizes the possibility of owing more money than the car is even worth.
This situation is what is referred to as an “upside down” loan.
A long term loan allows more flexibility financially and monthly payments aren’t as high. But you’ll have to wait longer for full ownership. Each option has its positives and negatives, the best choice comes down to what you’re most comfortable with.
Final Thoughts
In conclusion, it may seem that taking out a title loan is a risk. However, it is much more typical than you think, and using the equity of your vehicle rather than letting it depreciate is smart. Allowing your car to help you make some money or allow you to get further ahead in life is better than the typical standard of your vehicle losing its value.
Your vehicle is automatically worth 30% less upon driving it off the lot. This is your way of leveraging your vehicle to gain some of that back. More and more people are taking advantage of car title loans, and it is becoming more common than you think. You must have a good plan to pay it back and some guaranteed income to make the easily affordable payments.
At Cash Loans Alberta, we offer an effortless approval process. No firm restrictions or inflexible guidelines when you come to us. Also, you get to keep your vehicle as well! As such, you can quickly gain access to the cash you need, while also being able to drive off with your car. Contact us today to learn more.
