The title loan can support your financial problems. The loan amount will be decided by the lender after a mutual understanding between borrower and lender. The lender may charge an interest rate of 10% or more, which the borrower is ready to pay. Apart from the interest rate, the lender should intimate how much interest to be paid before accepting the loan. The loan lenders sometimes charge extra fees. There is no limit on the extra fee that is demanded by the lender, but it must be disclosed well in advance.
Office of Consumer Credit Commissioner’s consumer helpline details such as name, address, and contact number to be disclosed to the borrower. The notice to be provided stating that “The money borrowed from the title loan not to be used for long term financial needs but only for the short-term needs. Additional payment charges will be levied for refinancing the loan”.
Information to be revealed:
The state of Texas wants the lenders to reveal all the information regarding the loan terms and conditions at the earlier stage itself to the borrower. The information includes the interest during the loan tenure, total fees and the amount to be paid in case of loan renewal or refinancing.
Texas law also insists the lenders give information regarding the interest, fees and the APR charged on the title loan against the other loans. By this comparison, the borrower can make a reasonable decision.
When the borrower is late on paying the loan, the vehicle will automatically become at the risk of repossession. There is no need for the lender to get a court order and send a legal notice to the borrower for repossessing the vehicle. But mostly the lenders will not be doing this; they will be provided with some more periods or suggesting the plan for the payment of loan instead of repossession and sale. The lender has to pay some amount for the repossession agent and also the space required for parking the vehicle or the parking charge needed to be bare by the lender. There are also other expenses such as rekeying and brokerage charge for selling the vehicle that falls on the head of the lender.
After all with these difficulties, if a lender has to repossess the vehicle, he seeks to find a licensed repossession agent and the agent should follow the Texas laws of repossession. The agents cannot repossess with the property destruction, by violence, or by destroying the peace in any manner.
Once the vehicle has been repossessed, it will be in the position to sell to repay the debt. If the date of sale is finalized, then the borrower should be informed 10 days before the sale date. The information such as the date, time, and location of the sale is to be intimated to the borrower. In case if the borrower wants to redeem the vehicle, he has to bear the additional charges including the charge spent for repossessing and sale preparation.
The sale proceedings are carried out to cover up the debt borrowed. It is not sure the all the debts can be cleared the selling the repossessed vehicle. If the debt is not cleared, then the lender will appeal for further proceedings to get the balance. In that case, the borrower has to pay additionally the court fees and attorney’s charge.
The rules and laws set in Texas will be applied to entire Texas. Further, more stringent rules can be framed by the municipalities, towns, and cities in addition to Texas Title Loan Laws.