What does the saying, “When it rains, it pours,” mean? If you’ve been living on your own for a while, you know! Sometimes you seem to get hit with financial emergencies left and right.
If you facing some of these financial hardships and you live in Missouri, you may be seeking the best short-term loan option. Missouri has a highly competitive market when it comes to title loans.
They also have special regulations in place to protect the consumer. Keep reading to find out more about title loans and what they are all about in Missouri.
Plus, you’ll learn about the creative ways you can pay them back.
The Purpose of a Title Loan
Title loans help people get money when they have a sudden financial need. It is a quick and easy loan because your car acts as collateral for the loan.
Many people receive their funds in only a day. The focus of the title loan is your ability to pay not just your credit score. This helps people who have a low credit score to be able to get a loan.
Lenders’ main concern is if you have a job and steady income to where you can make the payments. They want you to pay the loan back! They aren’t interested in taking your car away but want to see you get the help you need.
The Missouri Title Loan Regulations
Missouri has specific regulations in place that title loan companies have to follow. These regulations are designed so they treat every customer fairly and with full disclosure.
Age
Missouri won’t allow anyone under the age of 18 to get a loan on their title. You must have a driver’s license or a state-issued ID that you can show the loan company.
Ownership
The person applying for the loan has to own the car they are putting up for the title loan. You can’t have another name on the title when applying for a title loan.
Disclosure
The loan company has to be upfront with you about all the details of the title loan. They have to let you know the full interest rate, how it is charged, and the steps that happen if you don’t pay.
Limits
The Missouri Title Loans Law also sets up some of the key limits and duties for the lenders in Missouri. It gives them guidelines to follow in case of defaulted loans.
They have limits set up for the interest rates and penalty fees that lenders can charge. The limits are also applied to the total loan amounts along with the maximum and/or minimum terms for loan repayment.
What You Need for a Title Loan in Missouri
By knowing what you need to bring to apply for a title loan, you can help make the process quicker. The more prepared you are when you seek a loan, the quicker it can be approved.
Your Information
The first piece of information they will ask for is your driver’s license. If you have another government-issued ID, that will also work. Many loan companies will also want to know your Social Security number if you have one.
Your credit score is not a necessary part of getting your loan, but many companies will check your credit. That is why they ask for the Social Security number.
You will need to prove that you have a checking account. You can bring a statement that has your name on it. Many companies will set up a bank draft for your payments.
Proof of income is one of the key pieces of information you will need. You can bring a few recent pay stubs or show them your bank account if you get paid automatically online.
Your Car’s Information
You will need to bring the title of your car to show that you are the sole owner of the vehicle. If someone else is on the title, the loan company will need to have them there also.
You may not have your title because it got lost or misplaced. Missouri has a simple way for you to get a copy of your title.
If you have another loan on the car, you probably won’t be able to get a title loan. The only exception is if the value of the loan is low enough so you can refinance it into your title loan.
It goes without saying, but you will need to bring the actual car to let them see it! They will want to look it over and assess what kind of shape the car is in. This will help them set the vehicle’s value so they can know what to loan you.
How to Determine the Title Loan Value of My Car
People often ask, “How do I know the title loan value of my car?” Loans are given on vehicles in any amount determined by the company. Your loan could be as low as $100 or as high as $50,000.
The main determining factor of your loan amount is made up of different aspects that loan companies look at.
The Vehicle’s Type
A high-end luxury brand vehicle that costs more upfront, will bring in more money on average for a loan. A regular mid-priced vehicle will bring in an average loan amount.
A low-priced vehicle will bring in the least amount on a loan because the value was lower to start with.
The specific type of vehicle also plays a part in the value. Trucks and SUVs usually have a higher value than a sedan.
The Vehicle’s Condition
The overall shape of your vehicle plays into its value. The engine, tires, and all-over mechanical condition are one part of the value. The other important factor is the condition of the exterior and interior.
Any scratches and dents can bring the value of the vehicle down. Ripped seats or worn-out carpets are sure ways of hurting the value. You want to make sure your vehicle is in the best condition possible.
Regular maintenance and care should help your vehicle hold its value for a loan or when you are looking to sell it.
The Vehicle’s Age
The age of your vehicle sets a base for its value. Every year as your car gets older it will decrease in value. This is because manufacturers are releasing new vehicles every year.
Therefore the older a car is the more its value has gone down. Some studies state that car values decrease about 60% in their first five years.
The Vehicle’s Mileage
Your odometer also has a lot to do with the value of your car. The higher mileage your vehicle has, the less value it will have. Your car can be in pristine condition, but high miles will hurt its value.
Even newer cars that have high miles will have a lower value than cars of the same age with fewer miles.
How to Get an Estimated Value
Your loan will be a percentage of your car value. You can get an estimate online of your car’s total value. There are online estimates by places like Kelly Blue Book or Nada.
These online estimators will give a generic estimate of the value of your vehicle. Fill out the forms openly and honestly about your vehicle’s condition and mileage. This will give you a much better estimate.
Questions to Ask When Looking at a Title Loan
Missouri has all kinds of title loan companies out there. You may get confused about which one you should pick. Here are some questions to help you make the most informed choice.
Prepayment Penalties
Some lenders will charge you a fee if you pay your loan off early! That is not something you want. Ask any lender you are looking at if they will allow you to pay off your loan early with no fees.
Creative Payment Schedule
See if the lender will work your payment to match your paycheck. They could offer you monthly or bi-weekly payments so you make the payment when you get your check.
Credit Score Reporting
A title loan could affect your credit score in a negative way. See if the lender will offer a no-report loan to help you keep your good credit score.
What Happens if I Miss a Payment?
Nobody wants to miss a payment on their loan, but what happens if you do? You may have heard horror stories about vehicles getting towed away the next day in some states!
That won’t happen in Missouri. The state of Missouri has some specific policies in place to protect everyone involved in a title loan. You can think of it as a three-strike policy.
Strike One
Missing your first payment by more than ten days will cause your lender to send a “Notice of Default and Right to Cure” letter. It will let you know that you are ten days late.
It will also let you know that you have to make a payment within the next 20 days or your vehicle will be repossessed.
Strike Two
Missing a payment a second time means you will get a “Second Notice of Default and Right to Cure” letter. The second letter will say you are late by ten days and have twenty days to make a payment.
Strike Three
The third strike happens if you don’t pay during the 20 days or miss a third payment. This will force the lender to send a “Notice of Our Plan to Sell Property” letter to you.
This letter informs you that you have ten days to pay the loan or they will sell your vehicle. The money from the sale gets used to pay off your balance and any charges for the repossession.
Ways to Repay a Title Loan Missouri
Repaying your title loan most often comes down to two methods. These are set up based on the company and how you want to pay it back.
Full Title Payback
The original title loan is designed to be a short-term loan. The collateral on the loan is the title to your car. This means that they can keep the car if you don’t pay back the loan.
When you have paid the loan off, you get the title back to your car. The biggest problem with these loans is if people can’t make a large payment to pay off the loan.
This can drag the loan out and cause the interest rate to rack up a lot of extra charges.
Title Installment Loans
The title installment loan is different in the way it is paid back. You still put your title down as the collateral for the loan, but the repayment is spread out over regular installments.
This gives the person who got the loan an easier way to pay the loan off instead of trying to come up with all the money at one time. It also spreads the interest rate out in a more manageable way.
Your payments are set and you know exactly what you are paying for principle and interest. This empowers every person to get their loan paid off in the best way for their personal finances.
Empowered Knowledge for Smart Choices
A title loan is something that can help people get through a rough time financially. The thing you want to do is learn all about them so you can make a smart choice of what’s best for you.
Having all the knowledge makes you an empowered consumer which helps everyone involved.
QuickLoans has been helping people throughout Missouri by offering financial services that help them when they need it. They have also been a stepping stone for many people to build back their credit ratings.
Contact them and find out about their Title Installment Loan. They have a passion for transparent communication built on a foundation of trust and respect.