If you’ve taken out a title loan, or are considering taking out a title loan—its probably because you’re broke, desperate, and have some bills to pay. It happens to the best of us, sometimes the money is just a little short. So you hear the commercial on the radio and think “well, I have a car” and next think you know some guy is writing you a $1000 check. It seems pretty easy because it is pretty easy—but there is a downside. Namely that you have to pay back that money, with interest on top. And what happens if you can’t repay the loan as you originally intended? Fees and fees and fines and fines and a seemingly never-ending wormhole of growing debt.
Pretty scary, right? Well there is, thankfully, a solution to the problem.
Title Loan Refinancing
Just like a traditional bank loan, you can refinance a title loan so that you can start a successful repayment plan and cut back on your stress and worry. If you’re wondering how to refinance a title loan, its actually pretty straightforward. Call your lender, be honest about your inability to meet the payment schedule, and take responsibility for your loan. The lender will want to work with you so that they can get repaid—they know that if you have no money, they will not get any repayment.
This is in many ways riskier than simply calling your lender and trying to work with the details of your loan to make it easier to pay back. But there is a chance you could get another loan with a different company that has better terms, and use the loan with better terms to pay off the first loan. This works in much the same way as refinancing your home loan.
Should you Refinance?
Whether or not you end up refinancing your loan, if you have a loan that you are struggling to make payments for you need to at least look into the possibility of refinancing. If you don’t consider it, your debt could grow and grow while you ignore it until it is in such a bad place that refinancing won’t even help. Its a hard decision to make, but you need to keep track of your title loan payments and if you’re missing them you need to strongly consider refinancing. Its a slippery slope that you don’t want to be sliding down.