Is An Auto Collateral Loan The Same As An Auto Title Loan?
There are a lot of terms thrown around when it comes to loans that may scare off borrowers. Some might include the terms ‘auto collateral loan’ and ‘auto title loan.’ Thankfully, we here at Texas Title and Payday Loan Services, Inc. make understanding these two terms simple. Yes, an auto collateral loan is the same as an auto title loan. The terms simply refer to different parts of the same loan.
The ‘collateral’ and ‘title’ are one and the same in this context, and both terms refer to the same type of loan. As it turns out, these terms are just different ways of saying the same thing. Basically, you need collateral – your car’s title – to get this loan. If you want to learn more about these terms, keep reading this article. We’ll highlight what these terms really mean and what this means when it comes to you getting this kind of loan from us.
Auto Collateral Loan Vs Auto Title Loan
Both an auto collateral loan and auto title loan refer to the same general type of loan: a title loan. A title loan is a secured loan, meaning that it requires collateral from the borrower to secure the loan. In this case, that collateral is the lien-free title of your vehicle. That's why the words ‘collateral’ and ‘title’ are used interchangeably. Functionally, the two are the same and describe easy title loans. When in practice, your car title acts as security for this loan here.
We place a lien against your car’s title, which incentivizes you as the borrower to repay the loan in full and on time. Doing so isn’t a malicious attempt to repossess your vehicle; in fact, it serves a beneficial twofold purpose. First, it allows us to mitigate the risk we undertake by lending you money. Second, it allows you as the borrower to demonstrate your commitment to repaying the loan on time and without any issue.
Unlike unsecured loans, which use other factors other than collateral to determine if you qualify for approval, secured loans actually have something at stake. This also means that we don’t have to rely so heavily on your credit to determine your eligibility. This means you can still apply and find out if you qualify for approval even if you have a poor credit history at the moment. To summarize, our process is as follows:
- You put up your car title as collateral, and we place a lien against it.
- You receive a lump sum of money and agree via contract to repay the loan over time.
- Once the loan is repaid in full, the lien is removed and we safely return your title.
When Are Easy Title Loans Right For You?
Hopefully the above explanation has helped you understand why different terms are used to refer to the same type of loan and how title loans work. You might still be wondering, “What’s this got to do with me?” Title loans can be helpful in situations where your ability to make payments is limited. For example, if your insurance refuses to pay for an important home repair, you may find yourself up a creek without a paddle.
In that situation, a title loan can help you cover those upfront expenses to keep you and your family safe. Not following through with urgent repairs, bills, or expenses can often be more detrimental to your finances. Always consider your options carefully. If you can avoid borrowing money, it’s usually better to do so. Still, life isn’t always so cut and dry, and there are times when a title loan can help in short-term emergency situations. Our clients use title loans for the following situations:
- Emergency medical bill
- Urgent repairs
- Important business travel
- Rent or utilities
- Other unplanned expenses
What Do I Need For An Auto Collateral Loan?
Whether you need urgent cash now or are preparing for an emergency, it’s good to know exactly what you need to get started to find out if you can get an auto collateral loan from us at Texas Car Title and Payday Loan Services, Inc. quickly and easily. The good thing is we’ve kept our list of required items short and simple for our customers to remember. Here’s what we require to take out one of our easy title loans:
- Your driver’s license or state-issued photo ID.
- Lien-free vehicle title in your name.
- Your car itself for inspection.
- Proof of income (or your most recent pay stub).
How The Process Works
To get an auto collateral loan, start with the online form on the website. Wait for a representative to contact you to go over the required items and to set up the vehicle inspection at the store or a location of your choosing. Either way, bring along your required items to the meeting. The representative will quickly go over them and assess everything to see if you qualify for approval. If you do, you’ll get your money the same day or the following business day.
Get Your Auto Collateral Loan Today
We here at Texas Title and Payday Loan Services, Inc. are proud to offer easy title loans – which you now know that they are also referred to as an auto collateral loan or auto title loan – for emergency situations. So if you’re struggling to manage an urgent situation on your own, we may be able to help you with a short-term influx of cash to keep you afloat. Are you ready to get started? Fill out our online application to get started on the process today!
Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.