Are All Auto Loans The Same?
If you are shopping for a new or used car, or if you are looking to refinance the lease or loan on your current vehicle, it is important to know that not all auto loan options are created equal. The good news is that while lending for unsecured loans (loans not backed by any collateral) still requires excellent credit, when searching for an auto loan you will find that the credit scores required in many cases are more lenient.
Financing A Vehicle
Depending on what type of vehicle you are looking to purchase, the auto loan you need may vary. Additionally, your credit score, along with whether you are purchasing your new car from a dealer or private individual, also matters. No matter what type of auto financing you need, and no matter what your credit type, we can help you achieve your auto loan goals quickly and safely online.
Below are a few of the different auto loan financing types that you may want to educate yourself on before shopping for a loan. When you're ready to get moving, give AmOne a call toll-free at 1-800-781-5187 to speak with one of our knowledgeable financial search specialists.
Buying a car from a local or national dealer
If you have found a vehicle that is being sold by a local or national auto loan dealer, a standard secured auto loan (which would be a collateral loan, using your house, as an example, to secure the loan) is most common. This type of loan usually offers the best rates and longest terms possible. This auto loan is approved based on the car's value and normally requires a down payment for approval. It may be provided by a national bank, credit union or various other types of finance companies. Key features of this type of loan are:
- Most new and used vehicles are considered
- Approvals are sometimes as fast as the same day
- You know what you are approved for in advance
- Rates starting as low as 1.65 percent for new vehicles and 1.75 percent for used cars
- Terms as long as six years to help make payments affordable
Buying a car from a private individual
When buying a car from a private party you have two loan types in which to choose from, an unsecured and secured loan. A secured auto loan is the most common. An unsecured auto loan is not tied to the vehicle and instead is approved based on your credit and ability to pay back the loan. This type of loan can give you the freedom to purchase the car you want which includes exotic or classic cars. Unsecured financing is harder to get because it is approved based on a good to excellent credit score. Unsecured loan terms are similar to standard auto loan terms, but the rate you will receive may be slightly higher than with conventional auto financing. A standard secured auto loan would have the following key features:
- Getting approved in advance and taking a check to the private party
- No obligation to activate your approval
- Most credit would be welcome
- Rates starting as low as 2.19 percent
Bad credit auto loans
If you have less than perfect credit but are still in need of a new car, there are some things you have to consider. Different from a conventional auto loan that allows you to buy a vehicle from any dealership, bad credit auto loans in many cases have specific networks of dealers where you can shop and purchase your car. These dealers have special arrangements with the bad credit lender that lowers the risk of the loan provider offering you financing. Because you have to shop at select dealerships, you may not get the exact car you want, however you can still be approved so that you can get on the road.
Using Equity In Your Car To Get A Loan
Auto title loans are a great way to get your hands on some cash when you credit history may not allow you to get a conventional unsecured loan. In order to qualify you generally have to either have a clear title or owe less than $2,000 on your existing car loan. Typically, the repayment terms will be 12 to 36 months and you can borrow up to 85 percent of the value of the equity in your car. Bad credit and self-employed individuals are welcome to apply for this loan product and most vehicles are considered.
If you are interested any type of auto loan, whether to purchase or refinance a new or existing car or to pull cash out of the equity of your car, AmOne can help you achieve your loan goals quickly and safely, all online. Our proven matching system uses the experience of previous borrowers to arrange great auto loan options all in one spot. You can complete our simple auto loan solutions form or call us toll-free at 1-800-781-5187 to speak with one of our knowledgeable financial search specialists. Our offices are open Monday through Friday from 9:00 AM to 9:00 PM and on Saturday from 9:00 AM to 5:00 PM Eastern time.