Approximately 80% of people who take car title loans roll them over at least once.
Rolling over a title loan offers a way to extend your due date, but it also costs extra money.
If you need some fast cash and want to apply for a car title loan, you might want to learn about some common title loan application mistakes that people make.
When you learn these mistakes, you can know what to avoid when applying for a car title loan. Here are five common errors people make when applying for these loans.
1. Applying for the First Loan They Come Across
The first mistake many people make is applying for the first title loan they come across instead of comparing their options. You can find many lenders when applying for loans online, so why choose the first one?
The better way to handle this is by comparing several lenders and their offers. You’ll find the best loan if you consider more than one option.
2. Borrowing More Money Than Needed
During the title loan application process, you can request any amount of money you’d like to borrow. The mistake that many people make is asking for too much money.
You shouldn’t borrow more money than you need. Instead, consider how much cash you need at this time and borrow that amount. If you borrow more than you need, you might have trouble repaying it on the due date.
3. Failing to Ask Questions
The next mistake you should avoid making is failing to ask questions. When you talk to the title loan provider, you can ask questions about things you would like to know.
For example, you might want to ask for a list of title loan requirements for eligibility. You might also want to know the interest rate and ways for repaying the money you borrow.
4. Signing Before Reading
When you’re ready to take the loan, the lender will give you a title loan agreement to sign. The mistake some people make is signing it without reading it.
If you don’t read the agreement, you won’t know what you’re agreeing to do. Therefore, make sure you read every line on the contract before agreeing to it.
5. Forgetting to Create a Repayment Plan
As you complete the title loan application process, you will learn about the repayment plan for the loan. You might have to pay it back in one lump-sum payment or make payments every week or month.
In any case, you should avoid the mistake of forgetting to prepare for the required payments. If you don’t figure these into your budget from the start, you might have trouble coming up with the money when it’s due.
Avoid These Title Loan Application Mistakes When Applying
It’s easy to make title loan application mistakes if you’ve never had a title loan before. Once you learn the common errors people make, though, you might have a better chance of avoiding them.
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