Car Title Loan for $5000 in Kansas City Missouri
This customer has just been handed some bad news. His furnace has quit, been red flagged and needs to be replaced at a projected cost of $5000, which is what he has applied for. He has an excellent credit rating, a home with equity available on it and a car that is also fully paid for. He was asking about car title loans and whether this would be a good approach for him to consider.
Car title loans work well for people who have bad credit and cannot get a loan approved. If they have equity in their car they can use this equity to be approved for a loan even with bad credit. The down side is that the cost of the loan in terms of interest rate is usually very high, unless you are able to secure a car title loan through a bank or through a dealer where you are buying a car. In situations like this the interest rate can be very low, even as low as a personal loan for someone with excellent credit.
This customer probably has several options that will be more attractive than a car title loan. He can apply for a personal loan and probably pay around 5% interest rate or he can add this onto his mortgage and remortgage the house. The interest rate for mortgages can be as low as 3%. Compared to the payments for a car title loan, they are much lower and much more economical for consumers. We provided the loan payments for each type of loan or mortgage in the table at the bottom of this post to illustrate the difference in monthly payments.
The ten year loan is considered to be part of the mortgage where he kept the same term and just added $5000 to the balance. The quickest and probably the most economic approach for this customer to go is to obtain a personal loan with his car as equity for the loan. Technically this is a car title loan, however if he is able to arrange to do this as a personal loan, with his great credit rating he will be able to save a great deal in interest costs and pay off his furnace quickly compared to the car title loan.
There is lots for this customer to think about and not a lot of time to do it. His furnace is not working, winter is approaching and he needs to make a decision quickly. There will be more discussion with him on this topic.
DEFAULT LOAN APPLICATION FOR BORROWER’S INFORMATION
Car Title Loan Amount :: $5000
Car Loan Application and Processing Speed (when do you need the funds)::as quickly as possible, we have to replace our furnace
Do you currently have a mortgage? :: yes , we have another 10 years to pay on it
Bank Name and Branch :: Missouri Bank, Maine street
What City/Town, State and County do you live in? :: Kansas City, Missouri
What is your employment field? :: Auto Repair
Employment Position :: Mechanic
When are you paid? (monthly/weekly/biweekly):: Biweekly
Your credit rating to be – excellent, fair, or bad? ::excellent
How did you find us? :: online search for car title loans
How are you paid? (direct deposit/paper check)::direct deposit
Gross Amount Per Paycheck :: $1440
Do you agree to have this information published online, without your PRIVATE information of course? :: ok
Extra information here please (some detail):: our furnace just quit on us and in fact it has been red flagged. What that means is that it cannot be used under any circumstances to heat our house and must be replaced. It also cannot be repaired without practically spending close to the same amount a new furnace would cost. A new furnace is going to cost us roughly $5000 which is what this loan application is for.
The technician said he could order it right away and it would be installed within a week, which is great but I need to come up with the money to pay for it first. They want a 50% down payment on order and the rest when it is installed. I do not have any savings that I can use to pay this amount at this time.
We own our home and have 10 years left on the mortgage. Our credit rating is really good, we have never missed a payment on anything and we own our car which is fully paid for. This is why we do not have any ready cash at the moment to pay for this new furnace. It is all in the car. It should be worth about $20,000 and we were thinking that we could get a car title loan and then pay off the loan as soon as we can. We heard there are no credit checks and the loan can be processed really quickly.
Note to Lender :: is a car title loan the right approach or should we apply for a personal loan or use some of the equity in our home to pay for the furnace. This is all new to us and all we know is that we need to come up with $5000 pretty quick, because we need some heat in this house before winter comes. Please advise.
|Category: Car Ttitle Loan||APR 3%||APR 5%||APR 300%|
|Length of Term||10||3||2|
|Amount to be paid||$5,756.18||$5,385.34||$20,622.07|
|Total interest paid||$756.18||$385.34||$15,622.07|
|Paid per installment||$47.31||$147.54||$847.48|