In situations of emergency, all you need is quick cash but even in such situation of urgency you need to know the story behind title loans in Alberta. Most of the people who seek to get these quick loans have poor credit rating and thus they cannot get loans from traditional lenders such as banks.
How does the loan work?
If you own a car, then you know it is a high value asset. With this car, you can head to the lender with it, and its title. Generally, the lender will assess the value of the car and then offer loans at certain percentage of its value. Lenders do not just consider the current value of the car but also its projected value if they were to sell it in the future.
The advantage of car title loans Hamilton is that their approval is fast and assuming you have everything with you that is, identification documents, title to the car, and any other requirement, then you can have the loan approved and credited to your account in less than one hour! This sounds good, but some lenders offer these loans at very high rates of interest. If you need one, ensure that you get quotes and review the terms of various car loan service providers and then choose one that suits your needs.
Types of car loans:
There are two major types of car loans in Alberta, namely the single payment and the instalment car loans.
Single payment loans:
These require repayment in lump sum, usually after thirty days. The average APR of these loans is 300% and thus they are generally costly.
These allow the borrower to repay the loan in instalments, usually within a period of between 3 and 6 months. The average APR of the instalment loans is 259%. Although they may be cheaper than the single payment loans, the instalment loans are still expensive.
Whichever way you view at it, title loans are generally costly. In fact, some studies show that while they may really help you get when you are in situation of financial emergency, when you look at it in terms of the long term cost of the loan, then it can worsen your already bad situation.
Are these loans really a good option?
Many people will tell you yes, because failing to get the loan may lead to worse results such as having your property auctioned by another lender, or losing a loved one to treatable condition. Even better, car loans are better when compared to the payday loans in Alberta, in which the APRs may sometimes be as high as over 1000%.
How to play it safe:
No one would like to borrow at very high rates of interest. However, if you find yourself in a situation where you have no option other seeking quick cash, a car loan is a good option. However, you need to put forward your best effort to ensure you repay it in order to avoid the car getting repossessed by the lander. Also compare the rates and terms offered by the lenders in Alberta and choose one that suits your needs.