In order to refinance your title loan, you apply for the new loan either by inquiring with a newer title company and provide your paperwork to them. Or you can apply with you existing title lender for a better deal to meet your needs and the lender’s needs. In both cases the process has the same end result, a lower APR. But what are the differences between the two refinancing processes? Let’s examine the first process by calling out the steps to get a title loan refi.
The first step is to look for a lender that meets your needs, offers a lower APR and can meet the title loan criteria. You’ll probably need to take your time to find the right lending source since the competition for your business is still intense. You should only sign on with a lender who has an established reputation, has an excellent rating with a local state attorney general’s office, etc. in order to ensure that a lawsuit-proof lending environment can be created because you’ll be dealing with the lender for three years.
What To Expect With A Title Loan Refinance?
Once you’ve found the right lender, come to the office to sign the paperwork necessary to effectively sign on as the new purchaser of your car title. Both you and the title lender will be required to sign a release of personal liability. The release must have language in it like: I agree to co-sign and executing the above co-signers responsibilities, I agree that any claims resulting from late payments to my original loan will be jointly and severally deductible as damages. I agree that any lien on my personal property, such as my home executing the release will be jointly and severally removed.
The lender will run a credit report on you to comply with the loan requirements and make sure you can qualify for a lower payoff. For your new loan to get funded and go through under FDCPA guidelines you’ll need to pay all your previous car title loans and other unsecured loans.
How Does A Title Loan Refinance Work
When your loan is funded, the lender expects you to make payments on time. So as long as you have a good payment history, and no more defaults or bankruptcies look at the loan as a great opportunity! You’ll have a chance to respond to the loan offer, which means that the monthly payment is reduced dollar for dollar by the amount charged to some of the revolving credit in your credit report. With this type of payment structure, within a short period the payment on a $25,000 loan can drop to $300 a month with a title loan refinance.
What Type of Credit Do I Need For A Title Loan Refinance
If you think you may have a problem making payments, you may want to move on to a lower interest title loan offer. But if you think you may still have some difficulties with your credit, think twice about taking out a title loan. You could easily end up with a much worse credit than when you started. And remember, what if something goes wrong and you don’t have the funds to pay?
Don’t be taken by surprise by large loan companies that may be difficult to get a credit check from. Some of the larger most reputable lenders will allow you to refinance a title pawn loan or title loan, but you need to look out for early prepayment fees and other unexpected charges. They always do this since they know that the people applying will likely have the down payment, then will be needing the funds for closing. These companies aren’t going to rely on no credit at all! Do your research and go secure with reputable lenders.