Car Title Loan questions... (car loan, insurance, vehicle, 2013)
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Hello..
Newly registered user with a quick question regarding car title loans.
My parents do not have good credit (bankruptcy a few years back)
I am looking to get a 1995 corvette, the car is selling for $11,999. However, we cannot get a car loan for a car older than 2005. We also cannot get a personal loan even with a co-signer due to the bankruptcy.
The only other option I am thinking of is a car title loan. But...
I do not have the title of the corvette because I am looking to BUY that car. Can you get a title loan by working through a dealership to get the money they need?
Is there a way to do this? Do I need to sweet talk the dealership into letting me do this? I cannot get a personal loan myself because I am 18 and have not established any credit yet.
Then you can't afford it.
There will be other cars.
A title loan operation is the worst place to get money.
You must first hold a clear car title (own the car)for them to use the car as collateral.
The thing that makes car title loans a bad idea is the incredibly high interest rate associated with them. Many states have banned them because of the fact that car title loans have been grouped into the predatory lending category. Their interest rates are even higher than credit card companies who take advantage of those with bad credit. If you think rates of 25% APR are high, imagine rates of 250%. Keep in mind that a monthly interest rate of 25% equals 300% APR. If you're paying $400 a month interest only on a $3,000 loan, after 7 months you will have paid $2,800, which is almost the principle balance, while still owing the full, original $3,000. Read the fine print and think carefully before attempting to get any kind of car title loan. The high interest rates are not worth, and in most cases, you would be better off getting a loan from a friend or family member.
Then you can't afford it.
There will be other cars.
A title loan operation is the worst place to get money.
You must first hold a clear car title (own the car)for them to use the car as collateral.
I can afford it, it's just that I cannot get approved of a loan. I have looked for cars 2005+ because of the secured car loan, but I am not finding anything for a decent price, and if it is a decent price the miles on it are outrageous. This corvette has 24k miles on it.
The interest rate on a title loan will floor you.
The problem with these types of loans is, you can never get them paid off.
When you default, they take the vehicle, and you still wind up owing more than the original loan was for.
Google title loans, and read the horror stories of people who got caught up in these loans.
It isn't pretty.
Bob.
A car title loan is a loan against a car you ALREADY own. You are putting that car up as collateral. Similar to how you might give a pawn shop a gold watch and they give you a few hundred dollars. If you don't return the money, they keep the watch. So, no you can't get a car title loan. Car title loans are a bad idea anyway. Get yourself a cheap car for whatever amount you were going to put down on the Corvette (you do have a down payment don't you??), a secured credit card to build your credit, and a book on personal finance since your parents clearly haven't helped you understand it well.
The fact that your bank will not give you a loan backs this up.
The fact that your looking to go to a loan shark also tells us you can't afford it.
Quote:
Originally Posted by twalk2013
I can afford it, it's just that I cannot get approved of a loan. I have looked for cars 2005+ because of the secured car loan, but I am not finding anything for a decent price, and if it is a decent price the miles on it are outrageous. This corvette has 24k miles on it.
PS, at 18years old and with no credit I got a new truck loan, and a credit card and that was back in the 80"s when it was much harder to secure a loan with out a co-singer.
beth98 is correct. A title loan is a short-term loan secured by your car's title. It's basically a payday loan with your car as collateral. You can't use it to purchase a car, and even if you could it's a terrible deal. My brother-in-law helped a kid out recently who took out a $750 title loan on his truck. Rather than pay it off when it was first due he kept rolling it over to the tune of $60 a week. Nine months and over $2000 later he still owed $750 for the truck.
I also agree that borrowing this much money to buy a 17-year-old sports car is probably a really bad idea. Are you planning to drive it on a regular basis? If so, the fact that it only has 24K miles will come back and bite you in the butt. There are a lot of little things that gradually break and get replaced over the life of a car, and age is as hard on many of them as miles. So in addition to your payment you can count on a bunch of repairs that will need to be made over a relatively short time frame once you start driving it. Not to mention high insurance and all that.
On the other hand, if your plan is to leave it in the garage most of the time and use it as a Sunday driver it will probably hold up fine, but a loan is still a bad idea as you'll be paying interest on the car as it loses value (remember, we're talking about a 1996, not a 1966). If that's the case then save up your money until you can pay cash for one. Don't worry, they will still be around when you can really afford it.
Now, if you're really sold on buying this car no matter how bad an idea it is, check with locally owned banks and credit unions. They will be more willing to look beyond the past financial problems and take an objective look at your current situation before making a decision. This is not my personal advice, just a suggestion.
Hello..
Newly registered user with a quick question regarding car title loans.
My parents do not have good credit (bankruptcy a few years back)
I am looking to get a 1995 corvette, the car is selling for $11,999. However, we cannot get a car loan for a car older than 2005. We also cannot get a personal loan even with a co-signer due to the bankruptcy.
The only other option I am thinking of is a car title loan. But...
I do not have the title of the corvette because I am looking to BUY that car. Can you get a title loan by working through a dealership to get the money they need?
Is there a way to do this? Do I need to sweet talk the dealership into letting me do this? I cannot get a personal loan myself because I am 18 and have not established any credit yet.
The dealer doesn't do loans? What kind of dealership are you going through? They should have a finance department that will be able to help you. If they don't I would stay away from that car because there's probably a reason it only has 25k on it.
The dealer doesn't do loans? What kind of dealership are you going through? They should have a finance department that will be able to help you. If they don't I would stay away from that car because there's probably a reason it only has 25k on it.
FYI, dealerships don't "do" loans unless it's a buy here-pay here. They do usually sell financing for banks and get a commission in return. Many banks won't loan money on a vehicle over X number of years old.
One wonders why you are asking this question if you can afford this car to begin with.
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