Getting Used Car Loans
Robert Edwin Ferguson
September 29, 2009
There are a number of online sites as well lenders that are willing to give you used car loans. You can also get the car loans from your family and friends. Understand all aspects of the loan before you get the car loan. While getting the used car loan it is important to remember a few things, especially when getting used car loans from a dealership.
Precautions to be Taken Before Getting a Used Car Loan
1. Check that the vehicle you have chosen is free from any existing financing or else you will be paying a really big monthly installment.
2. Check that the vehicle is relatively new (this means that the age of the vehicle is less than 5 years). Look at insurance and the registration papers of the vehicle to know this.
3. Ensure that the vehicle has been driven less than 60,000 miles. If the age of the vehicle is older than 5 years or it has run more than 60,000 miles, it is likely to more prone for repairs and maintenance.
4. Check if the vehicle has had an accident, or has been stolen
5. Get the condition of the vehicle checked from an independent mechanic. If the dealership does not allow an independent mechanic to check the vehicle, you should probably go to another dealership.
6. Confirm the price of the trade off before you apply for the used car loan.
You Can Also Get Used Car Loans from the Credit Institutions
Aside from car dealerships, you can also approach banks and credit institutions for used car loan. Even if you have bad credit, you can still get a bad credit car loan. Many credit unions and banks will give you car loans to buy the vehicle you desire. The factors that affect the rate of interest for the car loan are credit score, amount of your down payment, amount of your loan and the length of the loan. Sometimes you can also pre-pay for the loans. But, check before if there are any pre-payment penalties for the car loan.
The majority of banks, credit institutions and credit unions use the FICO score. A FICO score of less than 600 is considered to be a bad credit score, while a FICO score of 720 or above is considered to be a good credit score for getting car loans and other loans. A credit score of 850 is considered to be an excellent credit score. Those that have bad credit scores will have higher interest rates on their car loans. Those that have bad credit can be charged 13-17 percent rate of interest.
When you make monthly payment for the car loan on time, your credit score will improve. This will help you to get cheaper car loans and other loans in the future.
Getting Car Loans for Private Purchase
There are specialized lenders that provide car loans for private purchase. Many online sites that cater to bad credit car loan borrowers may not give you car loans for private purchase.
Keep your documentation ready when applying for a used car loan. Your credit reports, residence proof, salary and employment proof are the necessary documentation when applying for used car loans.
Precautions to be Taken Before Getting a Used Car Loan
1. Check that the vehicle you have chosen is free from any existing financing or else you will be paying a really big monthly installment.
2. Check that the vehicle is relatively new (this means that the age of the vehicle is less than 5 years). Look at insurance and the registration papers of the vehicle to know this.
3. Ensure that the vehicle has been driven less than 60,000 miles. If the age of the vehicle is older than 5 years or it has run more than 60,000 miles, it is likely to more prone for repairs and maintenance.
4. Check if the vehicle has had an accident, or has been stolen
5. Get the condition of the vehicle checked from an independent mechanic. If the dealership does not allow an independent mechanic to check the vehicle, you should probably go to another dealership.
6. Confirm the price of the trade off before you apply for the used car loan.
You Can Also Get Used Car Loans from the Credit Institutions
Aside from car dealerships, you can also approach banks and credit institutions for used car loan. Even if you have bad credit, you can still get a bad credit car loan. Many credit unions and banks will give you car loans to buy the vehicle you desire. The factors that affect the rate of interest for the car loan are credit score, amount of your down payment, amount of your loan and the length of the loan. Sometimes you can also pre-pay for the loans. But, check before if there are any pre-payment penalties for the car loan.
The majority of banks, credit institutions and credit unions use the FICO score. A FICO score of less than 600 is considered to be a bad credit score, while a FICO score of 720 or above is considered to be a good credit score for getting car loans and other loans. A credit score of 850 is considered to be an excellent credit score. Those that have bad credit scores will have higher interest rates on their car loans. Those that have bad credit can be charged 13-17 percent rate of interest.
When you make monthly payment for the car loan on time, your credit score will improve. This will help you to get cheaper car loans and other loans in the future.
Getting Car Loans for Private Purchase
There are specialized lenders that provide car loans for private purchase. Many online sites that cater to bad credit car loan borrowers may not give you car loans for private purchase.
Keep your documentation ready when applying for a used car loan. Your credit reports, residence proof, salary and employment proof are the necessary documentation when applying for used car loans.
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