Florida may be out of a recession, but it always seems that people are tight on cash. When this happens they will look for ways to get cash for short term financial needs. We all know about payday loans and instant cash advances but those are tough because the rates are high and you often can’t borrow much. Qualified residents can get a hold of the extra money in a short amount of time. Using your car’s collateral is a great way to get emergency financing. Consider this option if you have bad credit or don’t want to deal with a bank or installment loan company. However, there are stories about people borrowing a large sum with hopes of paying it off in weeks. Only later do they realize that they owe more in finance charges than the principal itself. People ask how a financial arrangement like this can be legal. But it does happen and one can avoid such situations if he chooses a company and pays the equity loan on time. One of the main culprits of high fees for Florida online lenders is the rolling fees.
Florida Title Loan Rates – What To Expect From Your Lender
Financial service companies charge a high rate on the principal borrowed. Consider the APR for this loan, it would be somewhere in the range of 100%. In some extreme cases, some Miami title loan companies will charge rates as high as 200%. In this situation, the payback period is calculated by days rather than weeks. An online lender that provides $100 requires a payment of $115 on payday. If the borrower misses the payment, it will be rolled over to the next payment date and the next payment will then be $130. If this sequence is repeated for four pay periods, the borrower owes a total of $60 in finance charges, which’s a full 60% of the principal. When a full seven pay periods is rolled over, the finance fees will be more than the original amount of money borrowed. This is one situation where it should be avoided at all costs. We know regulations in Florida should stop fees and interest from rolling over. However, they don’t always apply to borrowers who seek out car title loans. Also, there are local lenders in cities like Fort Myers, Miami, and Orlando that attempt to skirt licensing restrictions. For example, Miami requires some businesses to obtain a permit or business license before they operate in the city. Check your city and county requirements before signing a contract.
One simple way to avoid this situation is to research the rates before even taking out a cash loan. Many borrowers need cash for an emergency. They look past the situation and understand it’s a short term request. Some applicants take out a title loan without comparing rates between each online lender. Many times they go with a higher rate loan with a title lender who promises them more money upfront. A Borrower should spend a couple of hours online understanding the payment structure. Search for better first-time deals online before taking out vehicle equity financing. Work with a title loan company in Florida that provides the best rates and fee disclosures before you sign up. We know by doing this they can lower or eliminate some fees.
Find a Title Loan Company That Has Low Fees and Finance Charges
The other obvious way to avoid a roll-over fee is to pay back the vehicle title loan on time. This is a simple and realistic way to avoid the rolling fees. Work with your local Florida company to deduct from the payoff itself. You can fix any tendency not to pay and make sure that it is a full repayment and not a partial monthly payment. Most cash advance firms will allow a partial payment, but this is nothing further from the truth. The next solution to emergency cash is to consider other sources of credit. Even though a credit card company charges a high interest rate, it is still lower than an installment or payday loan. Increasing your debt amount will impact your credit score and payment history. So, the same old rules apply here as with a car title loan. Make your monthly payments on time without fail. By doing this you don’t need to work with bad credit lenders when you need money.
Use a credit counseling service to help an individual plan your finances after paying off the loan in full. A credit counselor can help to point people towards sound financial services. Most reputable car title loan lenders will help you find a licensed firm that provides these services. Also, consider a title loan company that helps with payday loan reduction. They will work to improve your credit score and help set up a monthly budget. Our article explains the way to reduce the finance charges for title loans. You should not consider a title loan in Florida if the need is not critical. Instead, plan your finances and take control of your budget and expenses.