As most personal finance bloggers have written in the past, most Americans don’t have enough money saved to cover even the smallest financial emergencies. And as I’ve written before, many people find themselves in situations where they need a loan but don’t have the credit score for it.
It’s sort of ironic; the segment of the population that has and makes the least amount of money and needs to borrow it is the segment of the population with the lowest credit score.
Wait, is that ironic? Am I using that word correctly?
So imagine you lived in California or something and you had bad credit. You needed a loan. Every single bank has turned you down because every single one of us bankers out there is out to get you.
What exactly do you do?
Well, let’s look at that clunker of a junker you call a car. Yeah, that metal projectile on wheels that eats up a ton of money on gas, maintenance, and insurance.
How do we turn that car into cash?
Well, wherever you live, there are plenty of reputable companies that can do just that. In California, one such company is Trading Financial Credit LLC, or TFC. They’ll help you turn your car into cash, but you have to know what to request from them. So here are 4 bad ways–and one good–that TFC will help you do just that.
1) Asking TFC to cast a spell on your car that turns it into cash
One method of turning your car into cash is by casting a spell on it.
Using the dark forces of the magic arts, a car can be instantly transformed into a large pile of bank notes of the same size and mass as the original vehicle. The denominations of the bills would depend on the Kelley Blue Book value of your car.
However, that requires magic training and certification from the Hogwarts School of Witchcraft and Wizardry. When I reached out to TFC, they told me that none of their staff have any of these.
Disappointed as I am, I’m actually not surprised. The financial institutions got rid of the magic wands after the housing crisis in 2008, and many customers don’t realize this. I’m working with some potential HELOC customers right now that think I’m going to magically conjure up a HELOC without them needing to bring in required documentation.
2) Asking for a TFC employee to be your car’s getaway driver in a bank heist
Another way to turn your car into cash is to use it as a getaway vehicle for a bank heist. Popular culture shows this to be a very lucrative way to make money fast, and even MIT professors have gotten into the act in the last few years. You need a driver ready when you run out of the bank with the stolen money as the precious few seconds wasted starting the car will cost you dearly. But depending on the speed and maneuverability of your vehicle, you may be able to avoid the police and get away with it.
However, many logistical problems come into play. Besides the fact that banks keep very little money in their vaults and also employ Certified Anti-Money Laundering Specialists to determine if someone is spending ill-gotten money, there is the major issue that bank robbery is a felony.
TFC is a reputable company that only engages in legal business activities. They will not be able to accommodate any requests to send a getaway driver for your bank heist.
3) Using alchemy to chemically turn your car into cash
As seen in the anime Fullmetal Alchemist, knowledge of alchemy can theoretically be used to turn your car into cash.
Using a metaphysical scientific process called “transmutation” and full knowledge of all the inner workings of the automobile, one can use a Transmutation Circle to replace the vehicle with cash, provided that the cash is of equivalent value to the vehicle. The Principle Of Equivalent Exchange states that whatever you wish to transmute your car into must be of equivalent value to the original vehicle.
The problem is that, again, this is science and not magic. “Equivalent value” means weight, mass, and chemical makeup. A pile of cash does not have the same chemical makeup as the vehicle itself. Attempting to perform a transmutation will likely cause a “Rebound” to occur, in which the natural forces that have been thrown into chaos take from the initiator of the transmutation process to restore balance. This can result in injury, mutilation, or death.
Due to the risks involved in transmutation, TFC employees are not allowed by company policy to honor such requests.
4) Selling your car on TFC’s Facebook page
The age old method of turning an item into cash: selling it.
The concept of selling something doesn’t need to be explained in depth. And neither does using Facebook and other social media platforms to do so. It goes without saying that the Internet connects buyers and sellers together in a way that wasn’t possible just decades ago.
But there are two issues with selling your car on TFC’s Facebook page. First, when you sell your car, you no longer have it. How are you getting to the grocery store? Or to work?
Chances are that you don’t live in one the 10 major cities with the best public transportation. Many small towns have one bus that comes every hour down the main road. If you don’t have a car, you can’t get to work. So selling that car is not an option.
And second, TFC’s Facebook page is not a place where you’re allowed to list your vehicle for sale. They will remove the listing.
So those were four bad ways to turn your car into cash. Frankly, many of them were stretches even with TFC helping you out. And this is a company that specializes in doing just that, helping you get quick emergency money from your vehicle.
So then what’s a good way to have TFC help you get money from your car when you need it most?
5) Getting a TFC title loan
The best way to turn your car into emergency cash is with a TFC title loan.
A title loan is a loan that uses your car’s title as the collateral. Not the car itself, but the title. When you apply for the loan, you allow TFC to put a lien on your car and you give them the hard copy of the title. When you pay back the loan, you get your title back and the lien is removed. If you default, the car gets repossessed.
Notice how it’s the title of the loan rather than the car itself? You still get to keep your car during the time that the loan is still outstanding.
That means you can actually get to work and pay off your loan.
What’s more is that people with low credit can qualify for the loans that bank customers wouldn’t. TFC does run your credit, but they place little emphasis on it. Being a collateral loan, they’re going to base the terms of the loan primarily on the resell value of your car.
TFC also takes the fact that these loans are for emergencies into account. Expect the loan process to take as little as one business day.
Now one thing you need to be aware of when it comes to title loans is that they often have very high interest rates.
These loans are for risky borrowers, don’t forget. Even with the collateral, a title loan is still an emergency loan geared towards low income subprime borrowers. In other words, the people least likely to pay back money they owe. So APRs can get a bit high when it comes to these loans.
Interest rates are capped, but the rates differ depending on state law. In California, where TFC is headquartered, the cap for loans under $2,500 is 360%. But if you borrow more, there is no cap! The sky’s the limit!
With TFC title loans, your rate can be capped at 35.99% if you qualify for their VIP program, which starts at $5,000. That’s better than the triple digit rates that competitors would charge.
So what do you need in order to apply? What does the loan process look like? What steps are necessary?
You will need to:
- Apply. Obviously. You start the process online and they call you back to complete and give you a free quote.
- Be prepared to provide:
- Driver’s License–Yes, you have to show ID to get a title loan.
- Proof of car insurance.
- The car’s title. For the title loan.
- Bank statements or proof of income.
- Proof of address.
- Four references.
- Photos of the vehicle.
- Inspection. They have to actually see the car. Otherwise, how do they know you didn’t rip the photos off Google or something?
- Sign the closing docs and receive your money.
And what really sets getting a title loan from TFC apart from the other four ways to turn your car into cash?
TFC will actually do it.
Readers–What do YOU think!? Is a TFC title loan a valid and pragmatic way to get emergency cash without sacrificing your vehicle? Or is it a debt trap that should be avoided at all costs? Does anybody have any experience with TFC title loans? Leave your thoughts in the comments below!
Disclaimer: This is a sponsored post. I was compensated financially to write it. As always, I only recommend companies that I’ve either done business with personally, or that I’ve reasonably verified are legitimate and ethical and have positive reviews. Always do your own research when choosing a lender for any kind of collateral loans.