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August 25, 2005 - Car Loans 101
Let's say you want a new car but you are confused about the car loan process. Fear not, we have bought a lot of cars and getting a loan for a car is easy, very easy. Today you have several car loan sources including the car maker, your bank, or online car loan specialists like Capital One
If you are ready to get a car loan here are a few top notch online providers:
Any Credit Auto Loans from 1800-Auto Yes
Apply for your vehicle loan with Capital One Auto Finance
Car loans for people with bad credit from E-Loan
The interest rate you get on your car loan and the length of the loan available to you will depend on your credit rating. The better your credit rating the lower interest rate you can get. A good credit rating will also give you more flexibility for the length of your loan.
Long and Short Car Loans
Typically car loans are available for periods ranging from 36 months to 60 months. It is possible to get a 72 month loan but that is not recommended unless you are purchasing a usually expensive vehicle. The shorter the car loan term the lower the interest rate will usually be. The difference between a 36 month loan and a 60 month loan is normally about three quarters of a point.
New Car, Used Car Dealer Purchase
New cars purchased from a dealer will normally have a better interest rate than used cars purchased from a dealer. Refinancing a car with a new loan can be done but the rates are almost 2 points higher than a new car financed through a dealer.
Person to Person Car Loans
If you are buying a car from an individual there are car loans available. These loans run about 2 and a half points higher than a new car loan rate for a car purchased directly from a dealer. Person to person car loans are common with the purchase of classic cars or expensive luxury cars.
Online Car Loan Providers
We recently tested out Capital One for a car loan on a new vehicle. They have a very easy program called the Blank Check Loan. You fill out the application online and specify the amount you want to borrow. If approved Capital One sends you a check with your name and addressed printed right on it. You make out the check to the seller, which can be a car dealer or anyone else selling the car. Our loan was approved in a few minutes and we received the check in the mail the next day.
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