Auto loans are fairly easy to obtain from a variety of sources – no matter how good or bad your credit may be. Options for auto loans include bank loans, finance companies, and in-house loans. The loan that you get depends on whether you are buying a used or a new vehicle.Most banks and finance companies, such as GM, will not loan money on vehicles that are over five years old. They also will not loan money on vehicles that are not worth the sales price. Therefore, if you are purchasing a used vehicle that is more than five years old, you will need to obtain in-house financing where you purchase the vehicle – or pay cash for the vehicle.When purchasing a new vehicle, depending on your credit, your best bet is to get your auto loan through a bank. In most cases, you will find that the interest is a little lower, making the payments lower and easier to manage. If you are unable to obtain bank financing, your next option is to go through an automobile financing company like GM. The credit requirements for GM are a little easier to meet, but usually a higher down payment is required, and the interest is also higher.In-house financing where you purchase the vehicle should be your last option. The interest is usually very high, and the loan amount is typically much more than the car is actually worth. While your credit score doesn’t matter much in this area, your ability to make a higher down payment and higher monthly payments on the auto loan matters a great deal.When you have auto loans, you will be required, in most cases, to carry full coverage insurance on the vehicle. Failure to carry such insurance can result in having the vehicle repossessed – even if you are making your payments as scheduled.
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