By John Campbell
If you’re facing a financial crisis and have no choice but to seek out a short-term loan with triple digit interest rates, an auto title loan should probably be your last resort.
Before you ever consider taking out a title loan you should consider any possible alternatives. If you don’t have the time or credit standing in which to get a mainstream loan you could look into a cash advance or even “hock” one of your prized possessions to get the money you need.
It may not be as costly, in comparison, to default on a cash advance or fail to pay on a hocked item a pawnbroker is sitting on. Fail to pay back a cash advance and you could be sued and even end up having your wages garnished until your loan is paid in full. Fail to pay off a pawnbroker and you’ll lose whatever item you originally hocked to get your money. Fail to pay back a title loan and you could end up losing the automobile you handed over the title to.
Losing what may be your only means of transportation may be simply too grave a risk, compared to the risks associated with other high interest loans. If you’re like many consumers, losing an automobile will make it very difficult, if not impossible, to get to work. If you can’t get to work you could quickly lose your job, which could leave you unable to pay your bills. From there, you could find yourself in foreclosure or wind up with an eviction notice. In a very short period of time, losing your automobile could trigger a catastrophic series of events that could leave you destitute.
If there is any alternative to get the money you may need now you should consider it. Is risking your automobile worth the potential consequences? Ultimately, you’ll have to be the judge of that.
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John Campbell is the writer and editor of CashBuzz, A financial portal for the rest of us. Check out cashbuzz.com for the latest articles on money management and tips and tricks that can help improve your finances. This article may be reprinted on your Web site if the copyright, author information and active link are included.
