The economic downturn due to COVID-19 has changed the lives of many people. A majority of people have used their savings for household activities to survive in this period. And now they all are working hard to improve their lifestyle, their credit scores, and their expenses. Life goes on and everyone is moving forward with it. People dream of buying their own house, going on an adventurous trip, traveling through the world, and much more. To accomplish goals, everyone is working for extra hours, saving money by cutting expenses, and doing many more things.
But it is hard to save a lot of money by doing a part-time job or cutting down the expenses. It may take a few years to save that much money and by the time you manage to achieve this the time will fly and you may not fulfill your dreams. Well, don’t worry. Here’s the perfect solution to your problem. You can use your valuable asset that is your vehicle to make more money. Most people opt for car collateral loans to get quick money in emergencies or for other reasons.
Have a look at the unique reasons why borrowers use car collateral loans to fulfill their financial needs.
Why Do People Choose Car Collateral Loans To Get Money?
- To get money using other assets than property
People who do not own a real estate property can use their other assets such as vehicles to make money for them. Well, title loans provide borrowers a way to get quick money without owning any investment properties. They can use this money to start a business, cover home repairs, or handle any other financial problems they face.
Like home equity loans, the value of your loan depends on the current market value of the vehicle you are using to apply for a loan. This means that the more value your car has, the more you can expect to receive.
The monthly installments are quite low so that you can manage and pay back the amount easily. If you are trying to save for a down payment and need to reduce expensive debt or other immediate expenses, this can be a useful strategy to speed up the process with less stress than other lending options.
- To save money for the future
Everyone plans about their future and works according to it, but life can have its own plan too. Many Canadians are still struggling to pay bills and expenses immediately and also plan for their financial future at the same time.
Car title loans can help you get a large amount of money to purchase major assets or pay bills without touching the retirement or rainy days funds.
- To get a large amount of money
If you have a bad credit history and you need a large amount of money, there are not many options available that can provide you a few hundred dollars immediately. But with title loans, you can get a huge amount of money depending on the equity of your vehicle. Further, if you do not have a strong financial history or are still looking for better opportunities, you can apply for this loan. Many lending institutions determine the value of collateral with just a few criteria such as year of purchase, make and model, kilometers it is used for, etc.
- To borrow money without surrendering the vehicle
One of the main reasons people choose this loan rather than other options is the fact that borrowers can use their vehicle even in the loan period. Lending institutions use the value of a borrower’s car to determine the loan amount and allow consumers to keep their vehicles during the repayment period.
For those who use their vehicle to travel to their workplace on a daily basis, this lending method does not disrupt their lifestyle while providing them with the money they need.
- To borrow money without credit check
Title loans are secured as the lender uses the lien-free title to the vehicle to approve your loan. This is why they do not perform any credit checks and thus provides you a chance to borrow money and save the integrity of their credit score. Also, the paperwork of this process is quite minimal and require a few documents such as:
- A valid Canadian driver’s license
- Proof of permanent residency
- Proof of legal age
- Vehicle registration papers
- Spare set of keys to the lien-free vehicle
- A fully paid vehicle
- Insurance papers in your name which include collision and deductible
- To get money on the same day of applying
You can apply for the loan within the comfort of your home and get pre approved within a few minutes. After submitting the required documents, you have to bring your vehicle to the lender’s office for inspection. After that, you’ll get approval and get the disbursal of money on the same day.
The ones who do not want to apply with strict requirements of banks and traditional lenders should consider this option. If you need a fast and easy way to get approved for the loan, collateral loans are the best way to move ahead.