Many people find that taking out a car title loan is a good solution when they need money fast. After all, it can be an easy way for someone who has bad credit to get money as long as they own their own car. However, the bad thing about a title loan is that it can be easy to get into a lot of debt that can be hard to pay off. The faster that you pay off your loan, the better. These are a few tips that can help you do so.
Don’t Borrow More Than You Need
For one thing, it can be tempting to borrow the largest amount that the title lender will let you borrow. This is especially true if you don’t have any money and if the title lender is making it possible for you to get a sizable sum in your hands right now. However, it is important to make sure that you do not borrow any more than you need. Even though one of these loans can be helpful if you’re behind on a couple of bills or need to cover a financial emergency, you probably shouldn’t be borrowing spending money. The more that you borrow, after all, the more you’re going to pay in interest and the more that you are going to have to pay back.
Choose the Right Lender Before Taking Out a Loan
Another way that you can help ensure that you are able to pay your loan back quickly is by making sure that you take your title loan out from the right lender in the first place. Some lenders charge more interest than others, which can make it more difficult for you to get your loan paid back in a timely manner. Some may charge a penalty for paying off your loan early, which is definitely something that you will want to avoid. If you do choose to take out one of these loans, you will definitely want to compare lenders and make sure that you take the time to read the fine print. This can help you ensure that you choose the best possible terms, which can help you save money and therefore make it easier for you to get your loan paid off faster.
Make Bigger Payments
Another way that you can get your loan paid off more quickly is to make bigger payments. Even rounding up the amount that you pay can help you shave down your payoff time. If possible, consider adding a more substantial amount to each payment. If you can double your payments, for example, you should be able to pay off your loan in less than half of the amount of time.
Make Payments More Often
If you’re able to, it’s also a good idea to make loan payments on your car title loan more often. For example, if you usually make a payment every two weeks, you could try making a payment once a week. If you end up with an unexpected cash windfall of some sort, such as if a family member gives you a cash gift for your birthday or for a holiday, you could consider using it to make an extra payment on your loan. Even though it can be tough to get used to making extra payments on your loan, doing so can be a good way to get it paid off quickly.
Pay it Off With Another Loan
One option that you can consider is to take out another type of loan to pay off your car title loan. Even though it might not seem like an idea to apply for yet another loan, this can work out well if the new loan has a lower interest rate than the loan that you were given on your car title loan. If you do choose to take this route, however, make sure that you check for the fine print. For example, if the loan has a low introductory rate, the rate might go up later on. You’ll definitely want to look into these things before taking out the loan to ensure that you are making a good financial decision.