Financial need is inevitable and often unpredictable; you never know when you may have a sudden need for cash. While most individuals consider taking a loan or selling something, many don’t realize that they have another option: pawning their car. In this article, we will look at what pawning cars mean and the benefits of the same.
Contents
What is pawning a car? When should you do it?
Pawning a car works like pawning any other object. You will first need to find a reliable car pawn shop and take the car to be pawned there. The shop owner will evaluate your vehicle and set a price for it (or you can ask for a specific amount). You and the lender can then work on a stipulated time by which you need to pay the loan back. If you don’t complete payment by this time, the pawnshop owner will sell your car to their sellers.
The best time to pawn your car is when you need fast cash, as the process is straightforward and doesn’t require you to wait around. That said, you need to have a second car or an alternative form of transportation to pawn your car because once pawned, the vehicle remains at the lender’s storage facility. Therefore, if you have only one car, pawning it might not be the best option for you.
Benefits of pawning your car
Given below are some of the benefits of pawning your car:
1. Fast cash
Perhaps the biggest advantage of pawning your car is getting cash quickly. When you set out to take a traditional loan, you have to jump through many hoops—endless documentation, interviews, credit assessments, and a long waiting period. This may seem feasible when your needs are not urgent. However, when you need money immediately, pawning your car has your back with instant processing.
2. Zero credit impact
When you go to a bank or any moneylender for loans, you will be subjected to extensive credit checks and invasive questioning. The number of credit reports you generate for different lenders can impact your credit score, and so does defaulting on payments. With pawning, you avoid this risk because there are no credit checks, and if you default on payment, the worst outcome would be losing your car; your credit score and health remain protected.
3. Confidentiality
As mentioned earlier, credit bureaus and financial institutions are not involved in the case of car pawning, unlike other traditional loan services. This means you can keep the fact that you pawned your car confidential without anyone ever knowing it. With a promise of confidentiality, you can be assured that no one will know your financial situation, reducing the need to give explanations to anyone.
4. No selling
More often than not, people resort to selling their cars when they are in need of cash. However, depending on how quickly you need money, you may not get the price your car deserves.
Car pawning, with a fast processing time, can help in such situations and prevent the need for selling your car. When the car is pawned, the car is still yours but is kept at a different location. Once you complete your repayment, you can reunite with your car easily.
Conclusion
Pawning cars is not complicated or a dooming aspect. Instead, it can offer you the financial help you need when you have an urgent requirement for cash. Unlike selling your vehicle, you still own your car and can easily get it back by repaying the loan. So, don’t contemplate anymore; get instant cash by pawning your car.
