ALBANY, GA (WALB) - They're on almost every corner promising fast money without the hassle of a credit check. "They basically want two things; you have a free and clear car title and a check that you have proof of income," said Cassandra Miller with We Care Alliance.
But what is not plastered on windows or banners are their high interest rates that in the state of Georgia can be as high as 300 percent. "When you are paying these high interest, paying more for that money, it's cutting back on food. It's cutting back on rent. It's cutting back on other things."
With most title pawn loans, if you miss a payment, you can lose your car or be forced to extend that loan adding on more fees. "They have your car title and can take away your car. And you won't be able to go to work, and you will keep spiraling down," said Miller.
Credit counselors encourage people to find ways to save now so you won't need to use title pawn loans if you have an emergency. "How can you save now, where can you cut back? With the economy and everything going on right now, it's so important to save," said Miller.
It is best to take the time to work on your credit history. "With good credit you are able to get good interest rates. With good credit you can get a home. And with what is going on in the banking industry, credit is going to be even more important."
"The last resort should be these payday loans. And even as the last resort, it may be better to do without," said Miller. So you won't be caught in these potential debt traps. Car title lenders are not regulated by the state.