There are several ways to get cash for a financial emergency. Some options include a title pawn, a car loan, and other means. You may wonder how a title pawn differs from these other options.
Auto Title Loans vs. Title Pawns
If you need cash but don’t have the time or resources to apply for a bank loan, an auto title loan or title pawn might be a good option. But before you decide to take out a title loan or pawn, consider the adverse effects that may be associated with it.
A car title loan uses the value of your vehicle as collateral. You can borrow as much as 50 percent of the value of your car. When the loan is paid off, you get the title back. However, the lender can repossess your vehicle if you don’t repay the loan, which could result in a destructive financial cycle.
Getting a title loan or pawn can be a good solution for short-term financial needs. These title loans Mississippi provide quick cash, but they come with high-interest rates.
The average payday loan is $300, but you can receive more if you apply for a title loan. Some loans are even as low as $100.
Although the average payday loan is small, more than three-quarters of users report having a significant income shock. That means they need help paying their bills and expenses.
Many consumers report poor credit scores, and many of these borrowers say they are being turned down for mainstream credit. This suggests that people are more likely to seek out new loans.
Other Ways to Get Cash for Financial Emergencies
You may have a few options if you need some cash for a financial emergency. One of the best ways to get the money you need is to call your local credit union and inquire about their services.
Other options include putting your cash to work by selling off your unwanted stuff. A good start would be a garage sale. This can be a very effective and inexpensive way to build your emergency fund.
Some people opt to take out a loan to cover their shortfalls. There are a variety of lenders, including government-run schemes. Most of them offer a same-day funding option.
Another option is to rely on your family and friends to help you through a crisis. It would help if you also kept an eye out for job openings. In some cases, you may qualify for unemployment benefits.
Finally, if you are fortunate enough to have a financially savvy spouse, consider opening a joint savings account. A good bank will let you set up automatic withdrawals of your hard-earned money, which is another way to ensure you have enough funds in the event of an emergency.
Taking the time to learn about your options and using your resources can be a wise decision.
Drawbacks of a Title Pawn
A title pawn is a convenient way to get a quick cash fix. However, borrowers should be aware of the drawbacks and benefits of this type of loan. Do your homework if you are considering a title pawn for the first time. Choosing a lousy lender can lead to a costly financial disaster. This is especially true if you take out a loan without collateral.
Title pawning is also a good bet if you have difficulty making car payments. The good news is that you can drive the car while making payments. However, you must pay off the title pawn by the end of the month to avoid ending up in a sticky situation.
While a title pawn does provide you with quick cash, the downside is that you will be paying interest on the title pawn for the duration of the loan. In addition, you may need to pay an annual fee on the title pawn. It’s important to remember that a title pawn can cost more than your average auto loan, so be wary of any lender that says you can finance your entire vehicle with a title pawn.
As with any financial product or service, you need to ensure you get the best deal. Look for a reputable online or offline dealer that offers the right combination of service and price.