After the Great Recession: Maximizing your Financial Potential

Looking at the latest trends in financial patterns among US consumers, it’s safe to say that many of them have begun to learn the lessons of the Great Recession. In the third quarter this year, consumer debt has continued to go down. While much of this has to do with the fact that some homeowners are walking away from their mortgages, it’s not all bad news. Many consumers are being more careful about using their credit cards. And others have grown increasingly creative in how they navigate their finances by utilizing alternate sources of credit and exploring new kinds of personal investments, including short term loans such as title loans.

Many consumers need to consider new and innovative strategies if they want to gain control of their financial circumstances. Some may request the services of a bank to help them come up with the extra money they need. This assistance may come in the form of loans like home equity loans, or in other financial services like credit cards. However, these types of services aren’t ideal for everyone. Consumers who are already dealing with credit problems typically don’t have much of a shot at borrowing money these ways.

For these reasons, there’s been a growing market in nonconventional financial services. The alternative financial services sector is comprised primarily of short term loans, which allow borrowers to take out loans without needing a perfect credit history. Payday loans are arguably the most commonly available and widely marketed short term loans. Payday loans, while not requiring a credit check, typically require proof of income. This is because they usually need to be paid back by the end of the week, when the borrower gets a paycheck.

One alternative to payday loans is to take out a car title loan. Some borrowers prefer these loans because they tend to offer a larger amount of money. While payday loans tend to be for an amount no larger than the borrower’s paycheck, car title loans offer a more generous amount that’s based on the value of the borrower’s vehicle. And unlike payday loans, car title loans can often take several years to pay back. Consumers might take out a car title loan for “debt consolidation” purposes, using the loan to pay off their debts and then making one convenient monthly payment on the title loan. Customer testimonials on title loan websites such as http://tfciloan.com and http://acartitleloan.com demonstrate that this is one of the most popular ways to use car title loans. While this decision may make a lot of sense for consumers who can’t get the traditional tools to get on top of their finances, it’s still important to weigh these decisions carefully.

Although some experts correlate the title loan industry to the debt cycle, the evidence of recent months does not support this theory. The amount of personal debt in the country has decreased significantly at the same time that the title loan industry has grown. Most consumers have used title loans to get out of debt and reorganize their finances.