What Is a Registration Loan?
A registration loan is a loan in which you use your car as collateral regardless if you’ve already paid for it in full or not. Registration loans can either be short-term or long-term depending on your needs and ability to pay the loan back, and they can be used for all sorts of emergencies. You might need some cash to pay an unexpected hospital bill or fix your fridge or washing machine that suddenly broke.
How Do Registration Loans Work?
If you are wondering how to apply for a registration loan, you can do so easily from the comfort of your own home in a simple and quick process. All you have to do is to fill out the application form online. Your application will be reviewed by the lender and you can then proceed by either finalizing the deal for the registration loan online or completing the registration in person.
Similarly, once approved, you have the choice of receiving the money in cash from the physical location or requesting to send it to your bank account.
Are Registration Loans Rates Exorbitant?
All short-term loans generally have higher interest rates than long-term loans such as mortgages. And registration loans are no different. However, with a registration loan, borrowers are able to get the funds that they need in exchange for their vehicle’s registration as collateral regardless of their credit score.
If you apply for a mortgage or even a car loan, traditional lenders will usually closely inspect your credit history to decide whether to give you a loan or not. You can get approval easily for a registration loan in contrast even if you have a low credit score.
How Much Money Can I Get with Registration Loans?
The amount of money you can get with a registration loan differs according to the circumstances: the value of the vehicle, your financial needs, as well as your income. All legitimate lenders will send offers to borrowers that are customized according to their specific situations and you will receive registration loan offers with different terms allowing you to choose the one that is best for you.
You should consider your specific situation and ability to pay back the amount to choose wisely what loan terms you agree on.
How Much Do You Want?
Can I Still Drive My Car with a Registration Loan?
Regular loans that are offered from pawn shops will usually have you surrender the vehicle you put as collateral until you pay the full amount. In this case, you will not be able to use your car and drive it from and back to your work or use it for your weekend outings.
But when you request and successfully get an online registration loan, you will be able to keep using it regularly while at the same time you pay back the loan. Your vehicle would still be in your possession as long as you are making the payments stated in the loan terms on time.
How Long Should I Pay off Registration Loan?
The terms of a registration loan will usually encompass one-year-long repayment options in which you would have to repay the loan in 12 installments. But depending on the loan amount itself, and especially if it is a large sum, you have the option to repay the registration loan for up to 3 years.
Some lenders allow you to repay the loan earlier at any time before the due date regardless of the length of your loan. This is always advisable because you don’t have to pay any extra fees for early payments, and most importantly you will save a lot in the long run.
Other Loan Options You Can Choose
It is always a good idea to know all of the options you have, especially in terms of any financial assistance that you need. Below are alternative loan options that you can apply for:
Title loans - A title loan is similar to a registration loan in that you will need collateral to get approval for the loan. However, to be able to get a title loan, you will need to be the official owner of the car and own its title to put the vehicle as collateral.
Payday loans - Payday loans are a great alternative to registration loans that will help you when you are faced with a sudden bill that your salary can’t cover. You will have to pay it back in full on your next payday.
Quick loans - Just as the name foretells, quick loans are approved quickly, are easy to apply to, and you will get your funds in no time. They make a great alternative when you are in an emergency and can’t afford waiting days for the lender to make a decision.
1- Can I use a motorcycle to get a registration loan?
Yes, you can use your motorcycle to apply for a registration loan. But the amount is usually determined according to the value of the motorcycle and it is usually less than what you can get with a title loan.
2- Is a checking account required while applying for a registration loan?
Definitely! One of the eligibility requirements, when you apply for a registration loan, is that the lender will need you to provide a checking account as well as a debit card in order to transfer the money to you once your loan is approved.
3- What are the differences between registration loans and title loans?
With a title loan, the title of your vehicle is needed to receive the loan amount. On the other hand, a registration loan will allow you to get cash in exchange for the registration of the car instead. So you can still put your car as collateral even if you still do not fully own it.
4- Can I still get a registration loan with bad credit?
People with bad credit scores might have a hard time securing a loan. However, you will find no issues at all to get a registration loan if you have low credit because many lenders who offer registration loans do not really mind giving out loans to people with bad credit scores.