If you’re in the need of a quick injection of cash, you might be considering taking out a car title loan. Car title loans are a great way for car-owners with less-than ideal credit to take advantage of their car.
Typically, car title loans are short-term loans that require you to pay back the loan in full, plus any interest you have accrued or added fees within a month.
If that short payment term does not work with your financial situation, you may be looking for a car title loan with a longer payment term.
While it may seem unlikely, it is actually quite simple to find a car title loan with a longer payment term. You just have to know what to look for.
Before we go over how to get long term title loans, let’s break down what it means to take out a loan for your car title.
Basically, the process of taking out a loan on your car title beings when you reach out to an online provider or local lender. From there, you will be asked to show the lender several documents.
These typically include an application, the title of your vehicle that you are putting up for collateral, and a photo ID. Many lenders will ask to either see a photo of the car or inspect it in person.
Lenders will also sometimes ask for proof of income, bank account information, proof of residence, or even references.
Because car title loans are secured loans where your car is being used as collateral, lenders will often ask to be given a spare set of keys. They may also ask for the borrower to install a GPS tracker or a remote immobilizer in the car. This will make the car easier to locate in the event of a repossession.
There are two kinds of car title loans.
The first type of car title loan is a single-payment loans require borrowers to repay the loan in one lump sum – usually in the aforementioned 30-day period – with an average APR of 300%. The second kind is an installment loan, which let the borrower pay back the loan in multiple payments.
The lender typically offers a repayment period of three to six months and an average APR of 259%.
So, if you are looking for a long-term title loan, you will of course be looking out for installment loans.
An installment loan operates in basically the same way as a short-term title loan except for the fact that instead of making on lump payment at the end of the 30-day period, you make several payments, plus interest, until the loan is paid off in full.
With an installment title loan, the loan is typically split up into equal periodic payments with apportion of the payment being applied to the principal. These long-term title loans typically last between 6 and 12 months, but
can be extend out to 18 or even 36 months.
You might think that you’ll need more when it comes to documents to qualify for a long-term title loans, but you’d be wrong. Just like this a short-term title loan, you will likely only be asked to provide the vehicle’s title, a proof of income, proof of car registration, and a photo ID.
In order to find a car title lender that deals with long-term loans, just start a simple online search. Most of the top car title lenders in the nation offer online application and approval. They will also detail what their payment terms are, and what your options are. Some lenders will offer both short and long-term title loans.
If you have already taken out a short-term title loan and are interested in turning it into a longer-term title loan, one option at your disposal is to refinance your loan. Refinancing your loan basically means getting another lender to buy out your current car title loan and offering you different terms of your loan. This can often include a longer payment term.
In order to refinance, you’ll have to find a potential lender who is willing to take your current loan on. You will complete an application process, which will include a requirement to verify the status of your existing loan as well as the lien holder of your vehicle.
On top of that, your vehicle will have to be inspected to assess its equity. Here are several steps you can expect
to undergo before being approved for a refinanced loan. Be prepared to hand over information and a number of documents to ensure that you can get the loan refinance you need.
- You will have to offer proof of your monthly income to ensure that you will be able to repay your new loan. A paystub or banking record should suffice.
- A government issued ID, such as a driver’s license or State ID card.
- Personal and professional references.
- Proof of full-coverage auto insurance (necessary for loans of $2,500 or higher).
- An open checking account.
Hopefully this quick crash course in long-term car title loans has helped clarify what you’ll need, where to look, and how to get a long-term car title loan. While it may have seemed rather difficult originally, it is actually quite simple!
All that’s left for you to do is to start the search for the right long-term car title loan for you.