A title loan is a temporary car loan given to a person in exchange for the car’s title. The title loan company holds the title to the car only until the loan is paid. The car’s owner retains the car and the right to use it.
Title loan services Nashville Tn requires monthly payments and charges interest on the borrowed amount. It is in the person’s best interest to pay the title loan off as early as they can to regain their title and improve their credit score.
Many people believe they must make the painful choice of getting a second job to pay off their title loan. This is an option, but not the only option. There are passive ways to pay off a title loan faster and get back on track financially.
Make Bi-Weekly Payments on the Title Loan
A title loan payment is due every month. Each month, the loan generates interests. This is extra money on the loan the person must pay. Instead of paying when the payment is due, pay every two weeks. Making biweekly payments adds up to one extra payment.
Another benefit of biweekly payments is that the interest decreases. By cutting payments in half, interest on the loan doesn’t generate every day. This means the person keeps the money they would have used to pay the interest in their bank account.
Use the Extra Paycheck to Make an Extra Payment on the Title Loan
A person paid weekly receives four paychecks a month. However, every four months each year, they receive a fifth paycheck. This fifth paycheck, or at least a portion of it, can go to an extra title loan payment.
The same happens for people paid biweekly. They normally receive two paychecks a month. They receive three paychecks a month two month out of the year. Instead of blowing the money, make an extra title loan payment.
Use the Bonus, Tax Refund or Pay Raise to Make Extra Payments
Bonuses are great way to save money. They are also a great way to pay off a title loan earlier than required. A person can do the same thing with their tax refund. By using a bonus or tax refund, they can eliminate a bill. This keeps more money in their pocket. Another way to pay off a title loan is to use a pay raise. This means keeping expenses the same. Instead of using that increase in pay, apply it towards the title loan.
Paying Off a Title Loan Early is Possible
A title loan is a perfect opportunity to pay off a bill or get money in an emergency. Title loan lenders don’t require a credit check or background check because the car’s title is used as collateral. By taking a few steps with the paychecks a person receives every week or two weeks, they can pay the title loan faster. It’s the perfect way to eliminate a bill and avoid financial disaster.