If you’re a college student and you’re short on cash for books or other fees this semester, you may be scrambling to get money quickly. Many lenders won’t approve you for a loan if you don’t have a job, but one convenient option is no income title loans. Regulations on auto title loans vary by […]
If you’re a college student and you’re short on cash for books or other fees this semester, you may be scrambling to get money quickly. Many lenders won’t approve you for a loan if you don’t have a job, but one convenient option is no income title loans.
Regulations on auto title loans vary by state, but most states don’t require you to provide proof of income to get a loan. But is paying for college with title loans a good idea? Let’s take a look at the pluses and minuses to see if it’s right for you.
Benefits of Paying for College with Title Loans
Title loans are known for being a very fast loan option with extremely high approval rates. Unlike other types of loans, you don’t need to bring the lender all of your financial documents for the last year or two. You don’t even need to bring a tax return or paystub with you. The only requirements are a government-issued ID to prove that you’re at least 18 years old, your car and your car title.
If you have a car that’s in your name with a lien-free title, you should be able to get a title loan based on its value. Some lenders even offer title loans if the car doesn’t have a lien-free title.
The entire application process for a title loan is short, and borrowers often find themselves in and out of the title loan company’s office in just an hour or less. You fill out some paperwork, the lender checks your car and once you give them your car title, you’ll get your loan. The lender will return your car title after you’ve paid off the loan.
Since you’ll still have your car over the term of the title loan, you don’t need to worry about how you’re going to get to school. And the speed of a title loan makes it an excellent option if you have expenses coming up that can’t wait.
Despite the benefits of title loans, there are also some things to keep in mind.
Potential Drawbacks of Paying for College with Title Loans
Here’s the number-one issue when it comes to using a title loan to pay college costs – title loans are generally intended to be short-term loans, and the standard term is 30 days. You can usually extend a title loan if you want, but this will cost you more money.
Student loans are intended to be long-term loans that students can get and then pay off over a period of years or even decades. With title loan debt, you’ll pay more the longer that you have it.
What this means is that if you’re looking for a loan to pay your course fees and then pay back over an extended period of time, a title loan won’t fit the bill. However, a title loan is great if you just need a quick financial boost that you plan to pay back soon. For example, if you need to pay course fees by tomorrow to avoid getting dropped from your classes, other types of loans will probably not be fast enough. You could get a title loan, get your course fees paid, and then either pay the title loan back with your own money, or wait for a long-term student loan to kick in and pay off the title loan with that.
Another thing to remember with title loans is that even though the lender only has your car title, your car is the collateral on the loan. That means that if you default on the loan, the lender can repossess your car and even sell it.
Default laws are another area where it varies by the state. Some states require lenders to give you 30 days as a right to cure, which means catching up on the payment that you missed. Others allow the lender to repossess your car right away. If your car gets repossessed, it could obviously be a huge inconvenience. This is why it’s so important that you have a plan in mind for how you’re going to pay back your title loan.
Figuring Out if a Title Loan Is Right for You
There is no single type of loan that’s best for everybody. It all depends on you and what you need the money for.
We believe that it’s important to fully educate borrowers about title loans so that they can make an informed decision. If you need a loan to pay for school and you won’t be able to pay it back until you finish school and get a job, then a title loan isn’t for you. You’re much better off going the traditional student loan route, which will allow you to complete school without worrying about paying back the loan.
For short-term cash, we highly recommend title loans. You can get a financial boost whenever you need it and deal with any immediate expenses.