How To Make The Most Of The Funds From A Title Loan

So, you’ve got a title loan to help manage your personal finances. Now what? Here’s how you can make the most of your funds when you take out a loan through Utah Title Loans, Inc.

Start by assessing which of your debts has the highest interest rate and committing as much as you can toward it each month. Once that debt is eliminated, you can either start from the top and work your way down or start from the bottom and work your way up.

Several approaches to debt reduction can help you be debt-free for keeps, but each technique is different for different circumstances. In this article, we’ll explore the best way to make use of your borrowed money and how you can stay on track for your future financial goals.

Tackling Debt 101

When you take out a title loan, you’re given a lump sum of money proportional to the assigned value of your vehicle. You’re free to use this money as you see fit, but, of course, it’s best to use it toward emergency situations. Generally, our clients use title loans for one of two things:

• Urgent repairs – If your home, car, or other asset needs repair, it’s usually better to do it sooner rather than later. Left unattended, small mechanical or structural problems can spiral out of control, posing a much bigger financial risk.
• Bills – Bills can be toxic the longer they are left unpaid as overdue charges pile up; moreover, not paying bills can negatively affect your credit and thus your buying power in the future.

In the case of the former, it’s best to only take out a title loan for what you need to cover the repairs and not a penny more. Then, you should carefully consider how you will repay the title loan (think of it as an exercise in financial responsibility).

An agent will explain your monthly payment schedule and what’s expected of you when you apply.

With bills, you can take one of two approaches: The Debt Snowball or the Debt Avalanche

The Debt Snowball

The Debt Snowball method of debt reduction aims to take the smallest debt you owe and wipe it out completely. Once you’ve done so, you can allocate more funds towards the next-smallest debt and so on. To do so, make minimum payments on everything else and maximize the payment on your smallest debt. Once eliminated, repeat with the next debt.

It’s wise to make an exception for debt with a particularly high interest rate, as it can be a drain on your finances. Similarly, it’s important to set aside money for your savings each month out of habit to start protecting yourself from future emergencies.

The Debt Avalanche

Another popular method is the Debt Avalanche, which starts with your largest debt and has you allocate as much as possible toward it. Once wiped out, you can focus on the next-largest debt.

Again, as a rule of thumb, it's often best to focus on high-interest debts first, even if they’re not the largest, as wiping these out is a major step forward to financial freedom. The cascading effect of the Debt Avalanche can help you manage your finances more effectively and gives a strong sense of accomplishment as you see your debts wiped off the board one by one.

How To Apply For A Loan

Now that you understand how to use loan funds effectively, here’s how you can apply through Utah Title Loans, Inc.:

1. Inquire online – From this webpage, you can fill out a quick form to connect with a nearby storefront.
2. Wait for a call back – When available, a representative will call you back to review the loan details, your monthly payment, and the next steps you will need to take, including scheduling a short meeting with an inspector.
3. Head to the in-person meeting – Whether you schedule a meeting at the store or a place you choose, you’ll need to bring your state-issued ID, lien-free title, and car to the inspection.
4. Get approved – If everything checks out, you may be approved for a title loan up to $15,000.
5. Tackle your debts – Once you’ve secured the funds, you can use them to knock out debt using either of the two methods we mentioned.

Take Control Of Your Personal Finances Today!

Tackling emergency bills or expenses can be a major source of stress, but with some financial planning, it doesn’t have to be.

To learn more or submit an inquiry, fill out the quick request form or give us a call at any of our store locations to see how much you could get on your vehicle. Utah Title Loans, Inc. makes getting the urgent cash you need easy, so you can start consolidating your debt today.

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