Many people have a general understanding of how loans work. You fill out a lengthy application, provide paperwork proving your ability to repay a loan, your credit score is checked and maybe even references are called. However, some people do not realize that Phoenix title loans work a little differently. You may have also heard a few rumors or myths about the title loan process. It is ok, you are not alone.
Each year many people turn to Phoenix title loans to obtain cash quickly in order to make it to payday or finance an emergency situation. The truth is, title loans have gotten a bad name, but there are a lot of things that people do not understand about title loans and why they are important.
Here Are The 5 Myths About Phoenix Title Loans Explained.
First off, what is a Phoenix title loan? A Phoenix title loan is a short-term loan you can take out against a car that you own outright. This means that you use your car’s title as collateral for the loan and you are currently not making any payments on your vehicle. Once the loan is paid off, the title is returned to you. If you do not pay your title loan, the company has the right to seize your car.
1. Myth: Phoenix Title Loans Will Gouge You With Interest Rates
Receiving cash with a payday loan, which is no longer available, is much different than a Phoenix Title Loan. People often confuse the two and they are quite different. Whereas payday loans will tack on a large amount of interest, Phoenix title loans are a little different.
The truth is that yes, the interest rates are a bit higher than most conventional loans. However, you can secure a Phoenix title loan with your vehicle. Therefore, there are no exorbitant amount of origination or documentation fees associated with your transaction.
2. Myth: All Phoenix Title Loans Charge Prepayment Penalties
Most people who need cash fast worry about paying excessive fees. With a Phoenix title loan, especially one from 1 Stop Title Loans, you will not pay any prepayment fees. What does this mean? It means you can pay off your loan sooner than later and not be charged any additional money.
3. Myth: You, Will, Have to Give Up Driving Your Vehicle
A very common misconception about Phoenix title loans is that since you will use your car as collateral, you will have to give your car up to the lender. What you actually do during the life of your loan is hand over the title of your vehicle. You get to keep on driving your car. In fact, the lender does not have room or resources to store your vehicle. They also truly want to see your loan paid off. It takes a lot of effort and almost more money than it is worth to repossess your vehicle, should you not make payments.
4. Myth: You Must Have Great Credit to Qualify
The best part about Phoenix title loans is that your credit is not taken into consideration, whatsoever. Therefore, you can have great credit, bad credit or no credit and still have the potential to qualify for this loan. You can receive fast cash, no matter what your credit history shows.
5. Myth: Phoenix Title Loans Are Complicated
Phoenix title loans are easy. The entire process of applying, qualifying, and receiving cash in hand can be done in as little as thirty minutes. There are no lengthy applications, loads of paperwork to bring in or extra references to call up.
For the most part, you can begin your application online or by phone. A representative from the company will contact you if you qualify and the rest of the work will be done in person. They will inspect your vehicle. If everything checks out, you can be handed cash the very same day. The process of receiving a Phoenix title loan is not complicated at all.
Final Thoughts On Phoenix Title Loans
It is easy to see why there are so many myths about Phoenix title loans. They can be super helpful should you find yourself in a tough situation. They are not scary nor do they have a lengthy application process. You can even continue to drive your car while you pay back the loan and there is no fee for paying your loan off early. All in all, Phoenix title loans are a good option for many people.