Used Car Loan Tips
A used car loan is a little bit different than financing a new car. Most banks will NOT lend you money for a used car that is more than 4 or 5 years old. Banks charge at least 2% higher APR on used car loans, than they do for new car loans. But online lenders are much cheaper, and used car loan rates are closer to new car loan rates.
There are two different types of used car loans. The first is when buying the used car from a dealer. The other is when you purchase from a private party.
If you plan to purchase a used car from a dealer
It is easier to get a used car loan if you are buying from a dealer. It doesn't matter if it is a dedicated used car dealership or a dealer that has a used car
department. Banks see less risk in this type of lending. Therefore, you will have more options when financing a used car.
Up2Drive and myAutoloan.com are two online lenders that will generally beat the dealer's rates.
If you plan to purchase a used car from a private party
Lenders see more risk when you buy from private party. Buying from a private party will usually get you a better price, but it will be much more difficult to get
a used car loan. In addition you will be paying a higher interest rate. myAutoloan.com is one of the
few online lenders that provides used car loans when buying from a private party.
Which site should you use? First make sure your credit score is at least 680, then as a prime borrower, you can choose by who has the lowest APR. People with
bad credit pay higher interest rates. Get your credit report instantly online, it's a must for The Folder.
DO NOT apply for a car loan until you get your credit report WITH credit score. Get it online at Experian,
TrueCredit or
Equifax. If your credit score
is less than 680 Auto Credit Express may be your best option.
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Up2Drive (a division of BMW Bank of North America) offers highly competitive rates and superior customer service.
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myAutoloan.com - Offers qualified applicants up to 4 online loan offers in minutes to help you maximize your car loan savings.
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Auto Credit Express is designed for people with poor credit. Auto Credit Express requires you to have a monthly income of $1,500.00 or more and be able to obtain auto insurance. Auto financing for people with lesser credit: If your Credit Score is below 650 and you're rejected, don't submit apps that keep getting you rejected. Submit one free application to a bad credit auto loan site like Auto Credit Express.
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Never pay cash for a deposit on a car
If the deal goes south, you'll never get your cash back, but you can always dispute a credit transaction. You may need a new, clean credit card to handle
deposits, and purchases, don't pay cash. What if you can't get credit at all and keep getting rejected? Don't keep applying to credit cards, get rejected, and
your credit history ruined further, find out who will approve you before you apply. If your credit is so bad and If you're in too deep, maybe now is not the time to buy a car.
Related CarBuyingTips.com content:
Make sure you know that car's history
Before you even think about financing a used car, you need to run a CARFAX ® Report
AND have a certified mechanic inspect the car. If you don't do both of these, and you end up getting screwed, don't email me. You have been warned. Learn
more in our Vehicle History Report article.
Get An Extended Warranty for your used Car
Get an extended warranty for your used car. If you buy a 3 or 4 year old used car, that's when the manufacturer's warranty expires and all hell breaks loose.
Unless you have an extended warranty, you are exposed to potentially large losses. The best car warranty sites we have researched so far are
CARCHEX and WarrantyDirect.
Click on the following link to read our complete guide on buying an Extended Warranty.
Shop Auto Insurance Costs for Your Used Car
Before you shop for a used car, get auto insurance quotes to find out how much it will cost to insure it. Auto insurance sites like BestCarInsuranceSite, Allstate,
GEICO and LowerMyBills.com
give free online car insurance quotes. Learn more in our Car Insurance article
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