Car is a very big financial asset that some people possess. When you buy it, you invest a lot of money on it, promising you efficiency and luxury. But at times of need when pledging your car becomes essential, then you must be sure that you are taking the help from some trusted companies. Here are some questions that often customers ask, and you should have a clear idea about it as well.
What Is Known As Collateral?
Usually, if someone is confused regarding what collateral is, then the best definition would be that it is a valued possession that you pledge to the company or the bank from whom you are taking a loan.
Car pledge (รับจํานํารถ, which is the term in Thai) is a type of security for the company or the bank. If you are unable to repay your loan then they would take guardianship of your possession.
How Does The Car Pledge Loan Work?
Cars are an expensive affair. And you never get to buy one at a very affordable rate. Cares thus have a big price and when you pledge it, there is a high chance that you would get a high amount in return. Usually, when you apply your car as collateral, the company looks at the working condition and the current selling price of the car.
This helps them to determine the amount of loan they could sanction to you. The loan could range above 80% or up to 150% above the price of the car. This fully depends on the policy and terms and condition of the bank or the loaning company.
Rules While Pledging the Car
When you pledge your car, you have to make sure that you sell it to no one else until and unless you have paid off the loan with interest. Otherwise, there is a high chance that you could be sent a warning letter. Also, an endorsement stipulation is usually attached to your car registration document.
You could get a big loan depending on the current price of your car. Again, if your credit score is good, then you get a lot of attractive interest options when you are pledging your car. With speedy processing and disbursals, car pledge truly is an advantageous step you could take.
While pledging your car, make sure that you check the interest rates of various loan giving companies and compare. This would help you get the best deal for your car. Abiding by law and order of processing your car as collateral would help you in getting your loan faster.