If you have ever leased a car, you know that you don't get the title until you pay off the car. Even if you take out a loan to buy the car, your bank holds the title. When you lease, the car company holds the title. This means that you can never sell your car if you want to. You have to hold the title to your car in order to sell it. For some people, owning the title isn't a big deal.

However, when you own your car, you can sell it or you can pass it down to your kids. If you are giving one of your children your car permanently, you can get the title changed for a very small fee. It's considered a gift by the law. This would not be possible if you didn't own the car.

Using Your Car as Collateral

In addition, if you own your car, it can be used as collateral for a secured loan. If you don't have great credit and need a loan you don't think you can get, you might want to consider a secured loan. This is when you use something like your house or your car as a guarantee against the loan. Therefore, if you default on the loan, your lender can repossess whatever you used for collateral.

This is why it is very important to make your payments on a secured loan. There are some great benefits to this kind of loan. They usually have lower monthly payments than unsecured loans. You can borrow more money, and you can generally stretch out your repayment longer than with an unsecured loan. If you are having trouble getting an unsecured loan and you really need the money, consider a secured loan.