Title pawns, or title loans, can offer quick cash, but it's crucial to be fully prepared before securing one. To ensure a responsible borrowing experience, ask yourself the following essential questions: What is your repayment plan? Do you own your car outright? What specific problem are you trying to solve, and how will you prevent it from recurring?

Addressing these questions before obtaining a title pawn can help you make informed decisions and manage your loan effectively. Here’s what you need to consider:

What’s Your Repayment Plan?

Look before you leap is a common saying for a reason, and it’s because it’s good advice. Far too often we reach for the nearest solution to a problem without thinking about what comes next. This can have a potentially disastrous blowback later when the devil wants his due and you’re not prepared.

With any type of loan, it’s important to have a concrete plan upfront for how, and when, you’re going to pay it back. Interest means that the longer you wait to pay them back the more you’ll have to pay in total. The best way to minimize any interest payments is to draw up a budget beforehand to identify where you’re going to get the money to pay back the loan at each step in its repayment.

Do You Own Your Car Outright?

This is a simple, but necessary question to ask yourself before taking out a title pawn. Because title pawn places use your car as collateral for your loan, the value of your car is what decides the amount of your loan. This takes into account things like the make and model of your car, along with its current conditions.

All three of those factors are meaningless if you don’t own your car outright though. This is why one of the required items for a title pawn is the ‘lien-free title’ to the car you’re taking a title pawn out on. A lien means essentially that someone else also has a claim to the value of your car, meaning that you don’t actually have the ability to promise it as collateral.

What Specific Problem Are You Trying to Solve?

It’s a normal reaction when beset with a financial challenge or three to start muddling them in your head and start to think of them as a single oppressive cloud over your head that can be banished with the light of some fast cash. Unfortunately, muddled expectations can lead to unsatisfactory results, and you may find that cash can’t fix all the problems that you face, or that you end up spending the money on minor problems while ignoring the major ones you face.

The best way to avoid this situation is to list out before you go to a title pawn place the specific problems you face, and exactly where you’re going to allocate the cash you get. For example, if you’ve just lost your job, list out your expenses and then mark the specific ones you’re going to spend your title pawn on when you get it. This will keep you from wasting the money once you get it, and also ensure that you come away from the situation with your problem actually fixed. Specificity is tiring but undeniably important.

How Will You Prevent Future Financial Issues?

This may seem like getting a step ahead of yourself, after all, you’re still actively trying to right the ship at this point, but it’s still worth it to take a minute before you take out a title pawn to try and figure out how you’re going to avoid the same situation simply happening again in the future.

 

 

The best way to do this is to sit down and create a budget for the future. Analyze your income and expenses, and then see how much you can put into an emergency fund each month. Though you may not be able to put in much, every little bit will help and add up over time so that the next time you’re hit with a financial emergency you’ll be able to handle the situation.

Ready to Apply for a Title Pawn?

Preparing thoroughly before taking out a title pawn ensures a more responsible borrowing experience. If you have the answers to these questions and are ready to move forward, apply today to get the financial assistance you need.

Submit your application now and take control of your financial situation with a title pawn!

 

Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.