Finance

Car Pawn Loans Help You Get Cash Out of Your Car

When you own your car outright, you’re driving around an asset that has value. In other words, even though your car may not be worth what it was when you bought it, it still has a resale value. And if you were to sell your car, you realize all of the asset value at once. If you’re not driving that car regularly and you need cash for an emergency, why not consider car pawn loans to tap into that asset value? You’ll get cash quickly to take care of your emergency and you can repay the loan to get your car back later.

Why Car Pawn Loans Instead of a Personal Loan?

Personal loans tend to have much higher interest than car pawn loans. And if your credit score is less than perfect, you pay a lot more for the privilege of borrowing the cash provided you get approved. That interest rate compounds every month, sending the balance higher if you can’t pay it off quickly. Then at the end of the loan, you’re left with nothing but a bigger hole in your pocket due to paying off the original amount borrowed and interest. A car pawn loan eliminates all of this by being straightforward, takes advantage of an existing asset, and allows you to get your car back when you’ve repaid.

Getting a Car Pawn Loan is Easy

You do need specific documents for a car pawn loan that relate to the car and proof of your ownership. Apart from that, you won’t fill out a lot of paperwork, wait for the credit check to go through, then wonder if you’ll be approved or not. You’re securing the loan with your asset as opposed a personal guarantee of repayment.

Because the car is physically present, the pawn company can give you an offer after a quick assessment of the car and comparison against current values. You are under no obligation to take the offer and your credit score remains the same because there is no hard pull to learn more information about your financial background.

Pay Back the Loan and Get Your Car Back

When you pawn your car, the pawn company takes possession and places it in a secure lot.  The car stays there until you repay the loan plus fees and interest within the allotted time period. As long as you pay off the loan in the stated time period, you’ll get your car back in the condition you left it in. And in the event you don’t want to keep your car, you can sell it to the pawn company and realize the rest of the asset value in the car instead of carrying the costs of a car that you don’t drive frequently.

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Mechelle Persaud

Mechelle Persaud

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