Having taken a car title loan out already, you may be finding yourself in a position where you are struggling to pay it off. Perhaps you have had to extend the loan and are now feeling buried due to high interest and fees being tacked onto your principal balance. You want to know what it takes to get the loan paid off so the lender doesn’t repossess your car. Have you tried asking a family member or friend to help you out? What about selling stuff on eBay or Craigslist? Garage sales can also bring in large amounts of money. What to do?
Have you thought about using your tax refund? Whether you have filed already and have a check coming your way, are in the process of plugging in the numbers, or are just getting fired up for the task of filing… your tax return could be your ticket to getting your car title loan paid off and your car title loan lender off your back! You may have other plans for that money… a vacation, new big screen TV, shopping spree… but don’t you think getting that car title loan paid off should be a priority?
A car title loan carries one of the highest interest rates on any loan out there. Not to mention, if you have to extend your loan term, you will be paying a great deal of money in fees and interest. What started out to be $1000 could end up double that amount. Car title loans are not meant to be long-term debt but when you “rollover” your payments, that is what your loan becomes. Not only can you clear up your loan obligation and be free and clear of those payments but you will get the “pink slip” back to your car and be rid of the worry that the lender may repossess your vehicle.
Unlike payday loans where the loan isn’t secured so the lender can’t go after anything of yours to recoup their costs, lenders have the title to your car. With that they are free to sell it at a car auction, get what they can and still go after you if there is a deficit between what you owe and what they got for it at the auction. In fact, you risk being sued should they need to take their collection process one step further. You can avoid that happening by using that unexpected cash from your tax return.
Taking advantage of having the cash to pay off your loan is an opportunity that may not come again for a while (if not a long time). You may have big ideas for that check from the government but putting your “wants” in front of your “needs” will only cause you to put yourself in a financially dangerous position; especially if your bank account is not budgeted for auto title loan costs. These types of loans are meant to be short-term and taken out for unforeseen or emergency costs. Even if you are considering taken out an auto title loan and are the least bit concerned about your ability to pay it back, find another way to