Title loans are a good option if you need money quickly, can pay on time, or even in full payments. Finding the right lender can be stressful though, as it takes research and time. We at Tio Rico we want you to be aware and prepared when making your financial decisions. Here we offer 3 factors to keep in mind when you are choosing title loans.
1. Check the Loan Company’s License
Luckily, the state of Arizona established laws and regulations that attempt to prevent loan sharking and unfair lending practices. All lenders are required to be licensed as “sales finance companies” under Arizona law whether it is Phoenix and Tucson title loans. There is a simple way to check a lender’s legitimacy. You can determine if an Arizona auto title loan company maintains a valid license by calling the Arizona Department of Financial Institutions (ADFI) or by visiting their website www.azdfi.gov.
2. Research, Read Everything and Don’t Ever Pay a Fee Upfront
Getting a title loan is simple, but you also want to know what to expect and feel prepared. Start by researching every requirement in your loan agreement, and don’t be afraid to ask your lender questions. Know exactly how much interest you will pay, what happens if you miss a payment, or if you need to pay late. You also need to have a backup plan if you think you may not be able to pay off the loan and think about what the consequences would be in that case. These are just a few situations to think about before you sign your loan contract. You don’t want to be surprised but prepared.
Also, never pay an upfront fee, whether it is online, via wire transfer, or in person. State legislation regulates title loan practices and states that you are not be required to pay a cash fee in order to receive your title loan. If a lender requires an upfront fee, then it is in your best interest to walk away.
3. Be Organized and Know Your Own Limits
When you do sign a loan contract, stay organized. Know when your repayment starts, how much is due, and keep all of your documentation. By staying organized, you can avoid unnecessary hassle or stress. Another way to avoid any hassles is by borrowing what you know you can pay back. If you bite off more than you can chew, you will only create more debt in the form of interest and unwanted late fees. The moment you take on a title loan, make sure you understand the limits of your budget and what you can afford. You’ll be glad you did!