In order to get the best deal on an auto loan for a used or new vehicle, it's important to be an informed consumer and follow certain steps.
Auto Loan Used
Used Auto Loan Financing
Basic Financing Requirements
- One year at the same employer if no credit rating.
- Two years employment history with some credit history.
- Minimum monthly gross income of $1500.00.
- Money down may be required, but not in every case.
- No repossession in last 12 months unless in bankruptcy.
- No motorcycle or private party purchases.
- Must reside in the United States or Canada.
Auto Credit Used Cars
All auto loan used cars are required to have a window sticker, much like new cars are required to have a "Monroney Label." The Used Car Rule, enforced by the Federal Trade Commission, requires that a Buyer's Guide be easily visible from outside the car. In addition to basic vehicle information, the Buyer's Guide must also show:
- Whether the vehicle is offered "as is" or with a warranty
- Warranty details, if a warranty is included with the vehicle
- What percentage of the repair costs a dealer will pay under warranty. In most used-car warranties, the dealer and vehicle owner each share a percentage of the cost of repairs according to the split listed on the buyers guide.
The Buyer's Guide also informs auto loan used buyers that oral promises are difficult to enforce, and it recommends that all promises be made in writing and also suggests that the car be inspected by an independent mechanic (you should make sure it is an ASE Certified Master Mechanic) before purchase. On the reverse side of the Buyer's Guide is a list of defects that an auto loan used vehicle might have.
Auto Loan Used - Steps
- Step one is to know know, before you begin shopping, what is contained in your credit report and what your credit score is. The most common credit score, the FICO score, is a three digit number between 300 and 850. The higher the number, the better your credit risk. If your credit score is above 640, there is a good chance you can get an auto loan used with a conventional lender with either a prime or near prime loan. If it is below 640, you will probably have to deal with a subprime lender.
- Step two in the auto loan used process is to know how much car you can afford. This means that you should determine a budget for your car. Be sure to include gas as well as insurance expenses (insurance needs to be full coverage). At the best auto loan used web sites, you will find a number of loan calculators that will help you estimate your car payment as well as give you an idea of your car budget.
- Step three is to choose your auto loan used car dealer carefully. Check with the local Better Business Bureau to see if the dealer has any complaints and, if so, were they handled in a timely manner. Dealers that are also franchised new car dealers can offer you a number of options on used cars, including certified used cars - something that non-franchised used car dealers cannot offer.
