CYLN.ob Set to Cash in On Car Title Loans
City Loan Inc. (OTCBB: CYLN) plays in one of the most interesting credit markets that I've ever come across.
The company provides loans to consumers and takes their automobiles as collateral. Think you're gonna drive off into the sunset with their dough? The joke's on you, Jack. CYLN.ob equips each car that it issues a loan on with a state-of-the art GPS system that directs the good ole repo man right to your front doorstep should you neglect to pay up.
While condemned by many consumer advocacy groups as one of the worst forms of predatory lending, the number of title loan companies has grown significantly over the past 5-10 because of the massive profit potential afforded by the auto pawn business model.
Massive Profit Potential for Companies Providing Title Loans
For starters, title loan companies typically don't fall under the same category as banks and credit card companies and get away with charging triple digit APRs. And you thought your Amex was bad.
Moreover, loaners typically only give out about 20% to 50% of the car's value, but in many states can retain all of the proceeds collected from sales of repossessed cars for defaulted loans. Many times the auto lone co. comes out of it all with the automobile even after the principal has been paid back, sometimes two times over.
Simply, put the auto title loan market is not exactly a feel good investment idea for most. But, with the economy in a recession and fears of another great depression mounting, consumers are increasingly hunting for cash to keep their businesses running and families fed. Ethical or not, company's like CYLN.ob are cashing in and will continue to do so until the bleeding stops.
The company provides loans to consumers and takes their automobiles as collateral. Think you're gonna drive off into the sunset with their dough? The joke's on you, Jack. CYLN.ob equips each car that it issues a loan on with a state-of-the art GPS system that directs the good ole repo man right to your front doorstep should you neglect to pay up.
While condemned by many consumer advocacy groups as one of the worst forms of predatory lending, the number of title loan companies has grown significantly over the past 5-10 because of the massive profit potential afforded by the auto pawn business model.
Massive Profit Potential for Companies Providing Title Loans
For starters, title loan companies typically don't fall under the same category as banks and credit card companies and get away with charging triple digit APRs. And you thought your Amex was bad.
Moreover, loaners typically only give out about 20% to 50% of the car's value, but in many states can retain all of the proceeds collected from sales of repossessed cars for defaulted loans. Many times the auto lone co. comes out of it all with the automobile even after the principal has been paid back, sometimes two times over.
Simply, put the auto title loan market is not exactly a feel good investment idea for most. But, with the economy in a recession and fears of another great depression mounting, consumers are increasingly hunting for cash to keep their businesses running and families fed. Ethical or not, company's like CYLN.ob are cashing in and will continue to do so until the bleeding stops.
Labels: City Loan Inc. City Loan, CYLN, OTCBB: CYLN
posted by "Staff" at
8:43 PM
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