It doesn’t matter whether you are poor or rich (within reason), for most people it’s just much more practical to finance the purchase of a vehicle with some type of loan. Some will opt to go directly through the dealership’s own finance program, whereas others are starting to take advantage of more creative solutions.
When we talk about such options, we’re mainly referring to the title loans that are commonly seen on the web. It won’t come as any surprise to see that these, like most car finance options, are marketed as secured loans. However, this is something that doesn’t just benefit and lessen the risk to the lender – as we take a look at four reasons why you should also benefit from the secured loan process.
Secured loans offer lower interest rates
Admittedly, this might be something that doesn’t directly apply to car title loans, but most other types of car finance (particularly those offered by dealerships), will have much lower rates of interest due to the “secured factor”. Dealerships are feel much easier about handing those low percentage deals out when they know that they will simply regain ownership of the vehicle if things take a turn for the worst. The rates on an unsecured loan for the purpose of a car purchase don’t bear thinking of, meanwhile.
You’ll be open to more flexible requirements
While the last issue may not have applied to the car title loan in the slightest, this next one certainly does. These loans in particular are known for their relaxed requirements and while the lenders will ask for your income, most of the time it will be exceptionally low with the hope of getting as many successful applicants as possible.
Similarly, the secured loan will also allow you to take out your package on terms that are generally much more flexible. These mainly revolve around the repayment schedule and again, when compared to an unsecured loan, you’ll be amazed at just how much of a better deal you will receive.
Answers can take days, rather than weeks
It would be fair to say that cars can be something of an impulse purchase and for most buyers, the time matters. Again, due to the lack of risk for lenders, a secured loan is something that generally takes much less time in comparison to one of an unsecured nature. In other words, if you’re worried about the last car on the lot being sold before you gather your finance together, it might be worth considering a secured solution.
The hassle-free solution
The previous benefit leads perfectly onto this one; secured loans just involve a lot less hassle. As you’ve probably been able to decipher through the course of this article, lenders are generally much more relaxed and happier to take so-called riskier applicants into account. Again, it’s completely due to the “secured factor” and rather than immediately thinking that you’re putting your finances at risk by opting for this, it’s worth considering the above benefits of secured loans if you are in the market for a new vehicle.