If you’re spending a bit of your time today researching how to a refinance title loan, then chances are pretty high that you’ve already got yourself a title loan or have begun looking into getting one within the next few days or weeks.
For those who are simply doing a bit of research though, a car title loan is an immensely useful method of financing to receive a cash loan by using your vehicle title as collateral. You can own a car, truck, a boat, or even a motorcycle, as long you have the signed title. The loan will offer a new line of credit by using the vehicle as the collateral, which means the lending company is well within their rights to repossess the vehicle if you cannot pay back the loan on a monthly basis.
If you already have the loan, but are having some trouble paying it back on time, then refinancing is certainly an option available to you, the consumer. You’ve probably already heard of refinancing in terms of a house mortgage or a regular loan that you may receive from the bank, but a title loan can still apply, too. The value of the loan is based solely off the vehicle you used as collateral, which could be too high for some. That’s not a problem, though!
So, to answer that very simple question, yes you absolutely can refinance your title loan through a third-party. You won’t need a good credit score in order to refinance this type of loan.
How Does It Work?
To start, a lending company can generally offer a percent of what your vehicle is worth for your loan itself. That is an insane bargain, especially considering other types of loans and what some businesses will offer. You want the most money as possible to help out your current situation, right?
First off, you need to own the vehicle outright. That means you will have had to pay off the vehicle in its entirety already. The title of the vehicle has to be within your name and have zero liens against it for a lending company to take it seriously.
Normally when you receive a title loan, the interest could be high, but still within reasonable levels when compared to other types of loans these days. But it could still be high enough to give you a bit of trouble. With that in mind, refinancing would be the one option to ensure you have a little bit of help and ease when it comes to repaying the loan itself. Those with high interest rates may be finding it quite difficult to repay and put a large dent in the loan itself instead of just the interest rate.
With a title loan refinance, you, the borrower, will simply roll the title of the vehicle over. This means you would take out a loan against the value of your car and the previous vehicle loan you already received. Of course, there are government limitations, which means you can only accomplish this process so many times. This process should allow you to pay back everyone you owe within a timely manner and get yourself out of long-term debt. Those finding themselves on the brink of financial ruin should seriously look into refinancing their car title loan, as it will help you in the long-run.
The best time to look into refinancing is when you are running into trouble paying back the original loan. A few of the basic bonuses towards refinancing include affordability, cost savings, and even ease of use, as it is easier to pay back overall.
Why You Should Refinance
Believe it or not, there is a lot of value in refinancing your title loan. A lot of people begin to panic when they owe money, they forego answering the phone when they know it is the lender in search of their missed payment. This is not a smart option, honestly. This will get you further in the hole and deeper into a mess financially.
Refinancing is, simply put, a loan against your title loan. Your title loan probably has a short period for repayment and a high interest rate. The refinancing loan, however, is a better deal, as it has entirely new terms, a new interest rate that is generally much lower than your previous loan, and is a bit more lenient in terms of the monthly payments, meaning you have longer to repay.
For example, let’s say you have two months to repay your original title loan, but that is not enough time and far too much money for your current finances to handle right now. It just doesn’t seem feasible, right? Refinancing that loan is highly valuable because it will allow you the opportunity to pay back the loan in an affordable, timely manner. You won’t feel rushed or desperate. Your interest rate will be a tad bit lower and you have more time to pay it back, all while keeping your vehicle at home and in your hands instead of with the lending company on the chopping block.
Overall, the entire process to refinance a loan is immensely simple. There are no complicated application forms to fill out, and there is no rigorous process that deems you worthy for the refinancing loan itself. There are no hoops this time around. There are plenty of companies that pay off title loans for you. They’re perfect for helping pay off title loans.
One simple form is all you need to fill out, which typically only requires your full name, your current address, and some other basic information alongside your current proof of income, which will show you can pay back the loan.
And of course, these types of loans do not require a credit check, meaning you can get your money almost immediately without having any negative impact on your credit score, which is a godsend these days.
There really is no reason not to refinance your title loan these days. It is a financial tool that has become beyond useful to the everyday individual. Refinancing is the perfect way to get out of a title loan without losing your car in the process!