Auto title loans are quite common in the United States these days. A lot of advertisements can be seen speaking well and prominently about this kind of title loan. Phoenix title loans are better known to be short term loans which can be borrowed against the present value of the vehicle you own. Your vehicle acts like a collateral against the cash given to the borrower. You just need to be sure that you do not have any other loan running against the car you have. You do not need to surrender your car physically against this loan and can still continue to run it.
There are times when each one of us gets broke and sometimes due to no credit, we are not eligible to get loans from a bank. In such scenarios, Phoenix vehciel title loans are of immense help. These title loans can easily get you hard cash in times of great need. No credit check is required for these title loans and only minimum income verification is done. Nevertheless, the things which seem extremely simple and straightforward are not so as far as these loans are concerned.
These Phoenix auto title loans have such high interest rates which can even make the credit card companies think twice. Many consumers who have taken these auto title loans have actually categorized Phoenix car loans as being the most negative predatory lending. Although they seem helpful initially, these loans can be a problem in the long run, if you are unable to pay on time.
The interest rates of the car title loan are extremely high. People generally know about the credit cards and really dread them due to the high rates of interest associated with the title loan. It would come as a surprise to them that the rates of interest of the car title loans are much higher than those. The companies which are involved in offering Phoenix car title loans deal in a completely different way than the banks and credit card companies. The rules followed by these companies are also extremely different from the banks and credit card companies. Accordingly, the car title loan lenders charge about triple digit percentage rates on an annual basis. It is not uncommon to come across about 250% percentage rates.
At times, these rates even go further up. The irony is that only a few states have strict laws in place which restrict these Phoenix vehicle title loan lenders from charging exorbitant amounts from in the form of interest from the borrowers. This is one big reason people are also abstaining quite a lot from borrowing money in the form of car title loans once they become aware of the consequences. It is suggested that the people should stay away from these car title loans as far as they can as they can put you into a bigger financial issue later.