March 4, 2013
When money is tight, title pawn loans can look like an attractive option. If you own your own vehicle, title pawn lenders will allow you to borrow money based on how much they believe your car is worth. They essentially own your car until you pay back the loan! If you are unable to repay the loan, they have full legal rights to collect and sell your car.
The lender undertakes very little risk and can collect quite a bundle from you in interest - sometimes upwards of 400%.
Title pawn lenders want you to mess up, to pay more than you have to, and to go further into debt. Here are the top three mistakes they want you to make so that they end up ahead at the end of the day:
- Pay the interest, not the principle: by paying just the minimum amount each month, your bill is low but you’ll pay a lot more over time. Since interest rates can be as high as 400% with title pawn loans, you could be making payments for years to come.
- Don’t pay back the loan: plain and simple, if you don’t repay the loan, they keep your title and all the money you paid to them so far is for naught.
- Believe title pawn loans are your only option: especially if you don’t have stellar credit, you may think that a title pawn loan is the only way to get the cash you need quickly. The good news is, that’s just not true. At Sterling Finance Company, we offer people loans up to $5,000 every day!
Unlike a title pawn loan, personal loans from Sterling Finance Company have competitively low interest rates. We will work with you and your unique situation, even if you don’t have great credit, and figure out a lending solution that will cover your needs and fit within your budget. If you have questions about the difference between a title pawn loan and a personal loan from SFC, and we hope you do, please give us a call or stop in at one of our many locations all across Georgia. Don’t fall prey to title pawn lenders’ schemes, give us the chance to convince you why a personal loan is a better option.