Curious about car title loans? We are going to take a look at the pros and cons of these personal loans, and will use Ohio as our example state. Car title loans provide one of the fastest ways to receive cash loans, especially if you have other pressing financial commitment or a less than perfect credit scores. A car title loan or auto title loan allows you to borrow cash against the value of your vehicle. Based on the value of your vehicle, the lender determines the amount of money you can receive. Borrowers can expect anything from $200 to $10,000 or as much as $20,000 or more in certain cases. The documents required to execute the transaction, include; a clear car title, verified address and state issued ID. The duration of repayment on most car loans can to go up to 36 months or more. When undertaking such a transaction, the lender keeps the title of the vehicle as security, while you keep your vehicle. In case a payment default occurs, depending on the agreed terms, the lender can attach and sells the vehicle to recover the owed amount.
Ohio has instituted several rules aimed at curtailing predatory lending by lenders; the rules governing title loan lenders are constituted under the Ohio consumer laws and statutes. Chapter 537 of the laws stipulates that the lender must sign a written agreement before advancing any loan to the borrower. The laws in Buckeye state allows lenders to charge up to 30% interest on loans. When it comes to repossession, the law requires the lender to notify the borrower of his intention to repossess the vehicle. This allows the vehicle owner to remove any personal effects from the vehicle and possibly hand over the vehicle to the lender at a designated date and time. Borrowers are also given up to 10 days to take back their vehicle, if all the required commitments and payments are made. After repossession and before the lender sells the vehicle to recover the owed amount, he must notify the borrower 10 days in advance about the time, place and sale details of the vehicle.
Car title loans are underwritten a bit different that a personal loan, but the borrower is generally free to use the proceeds are spent is entirely up to the borrower. What the borrower needs to do is make the agreed monthly payments on time to avoid the consequences that come with dishonoring the agreement. Before signing any binding agreement, it is important for the borrower to read between the fine lines. Borrower should also inquire from the lender; information regarding vehicle repossessions and recovery costs. Under the law, car title loan lenders are obligated to keep customer information, including personal details confidential.