3 Signs Lenders Would Rather Have You Pay Off Your Title LoanInk Well Mag January 31, 2016 0 COMMENTS
It’s not uncommon for title loan lenders in Utah to be put on a bad light. The media, the pro-consumer groups, the borrowers that “fell victim” to allegedly rip-off title loans — all of them have unpleasant things to tell and are strongly against the practices of the companies operation in this lending environment.
As a would-be borrower, you must know both sides of the story to make a sound decision. After all, you’re considering a secured loan, which can possibly cause you to lose your vehicle in the process due to default.
Even if title loan detractors have some points, it’s not only wrong, but also unfair, to think that lenders have structured this type of loan one-sidedly with the objective of repossessing the vehicle in the end. Truth is, there are many indicators that show otherwise.
UtahMoneyCenter.com explains how this is so:
Vehicle Reselling is Troublesome
First and foremost, reselling the vehicle is not a straightforward nor a cheap process. Repossessing the pawned vehicle spells legal and storage costs. By spending on these expenses, there’s no guarantee that the vehicle would be sold quickly, which there’s no telling when the lender would get their money back.
Considering all the hassle and uncertainties involved, it makes absolute sense that lenders would rather receive the repayments from borrowers than reaching the point when repossession is necessary. That way, the lenders get paid and the borrowers don’t lose possibly their only means of transportation.
Different Payment Options
If you apply for a car title loan in West Valley City, as well as in other cities in Utah, your lender would most likely give you a variety of ways for you to repay your debt conveniently. Many lenders are lenient because they know that borrowers taking this route are usually struggling financially. Without such choices, repayment would be a more difficult duty to fulfill.
Some lenders would even reduce the interest of the loan as an incentive for making timely payments. Paying on time should be expected from borrowers, so lenders are not really supposed to come up with such rewards if their ultimate goal is to make your repayments a living hell and claim your vehicle.
Title loans may not have the lowest annual percentage rate in the lending market, but it doesn’t mean the whole scheme is a con. In most cases, the worst-case scenario ensues after a series of shortcomings from imprudent borrowers.