Nowadays, many people are looking for different ways to get extra cash. A popular way to get extra funds is to take out an online loan. What to do, however, when we do not have creditworthiness and we want to take out a loan for an amount exceeding 5,000. Here, surprisingly, our car can come to our rescue.
Car title loan
This form of commitment is an interesting option for people whose creditworthiness is low or they are not interested in banking bureaucracy. By choosing a car loan, we can minimize any formalities and take the amount that satisfies us.
Imagine that you suddenly need cash but don’t have a very good credit history. However, we have a Volkswagen Passat B7 from 2013. The current market value of our vehicle is approximately PLN 40,000 (as of 2018).
If we want to take out a loan against this car, we can apply for up to PLN 25,000. This is because in most loan companies that provide this type of service, you can commit up to about 60% of the current value of the car.
Can I use the car that I have pledged?
Some time ago this was not possible. The use of the pledged item in the case of a loan agreement was impossible. Currently, the possibility of using a car while pledged is a standard practiced by companies from the non-banking sector.
This is a different practice, for example in pawn shops. There, to be able to use the car, we must first return the entire liability with additional costs. It must be admitted that a car loan will be an ideal proposition for people who use the vehicle as a work tool.
Online secured loan
We live in the 21st century, which appears to be the time of the Internet revolution. Today, service or product that is not adapted to the online version does not exist. It is similar to car loans. Applying such a commitment is similar to the process in which we apply for a standard online payday. In addition to the obligatory contact details, you must also complete the information about the car, including:
- car make and model;
- vehicle production year;
In the case of such a loan, we usually wait for contact from the advisor. Such a person should let us know within 24 hours of completing the application, although in practice it may happen even after a few minutes.
Car loan terms
Don’t worry – these types of contracts are not too complicated. After submitting the application and its positive verification, we will receive from the lender three sets of documents:
- loan agreement;
- a car ownership contract;
- power of attorney authorizing the lending institution to enter itself as co-owner of the car.
After signing these documents, the lender becomes the owner of 51% of the pledged vehicle. Here, too, we do not have to worry in advance, because the loan company also undertakes to transfer all ownership of the car to the borrower in the event of the loan being fully repaid. This type of commitment is therefore a very interesting proposition for car owners who want to quickly obtain additional funds.