Used Auto
Loan: Banks charge at least 2% higher APR on used car loans than they do for new auto loans. But online lenders are much cheaper, and used auto loan rates are closer to new car loan rates.


Used auto loans and used car financing
If you are buying a car from a private person, first see if you qualify for a used auto loan online for a competitive interest rate. Never pay cash for a deposit on an auto. If the deal falls through, you may never get your cash back, but you can always dispute a credit transaction.



How Much Used Auto Loan Can You Afford?
Before looking for a used auto, know how much you can afford. Banks will only lend you money to buy a used car up to 5 years old. This is why you are at a disadvantage when you trade in a used car over 4 years old at a dealer. The banks won't lend money to buy these older used cars, so they are harder to resell.



Some problems to be watchful when buying a used auto:

Prior accidents

Odometer rollback

Missing airbags

Flood damage

Mismatched VINs

Auto salvage auction sales

Stolen auto



Although a mechanic can check for obvious problems, you'll need to do a title search to learn details about the auto's history.


Tips on buying a used auto:

Search online used auto classifieds and your local newspaper. Get a 30 day unlimited Vehicle History Report from one of many online resources. Take a test drive to your mechanic, and have the auto looked over. A mechanic may only look at the engine and transmission, so you will need to inspect the trunk, upholstery and other areas. Negotiate with the seller or used car dealer. Make certain the seller has possession of the auto title, and transfers it to you immediately upon purchase, as well as providing a Bill of Sale. Most used autos are sold "As Is", but you can try to haggle for a limited warranty, such as a 30 day warranty on the engine and transmission. Don't be surprised; particularly if you're buying a used auto from an individual or an older model from a dealership, if you can't get any type of warranty. Finally, be sure the owner's name on the title is the same as the person selling the auto to you.

New and Used Cars  - The average used car costs less than half of the average new car and used autos outsell new cars 3-to-1. Typically, new cars depreciate in value during the first two years. It is important to learn more about any used auto you're interested in and consult a reference guide for a general idea of fair market values. Two books are good for this, the Kelley Blue Book and the Edmunds.

Take some time to anticipate all the costs for fuel, registration fees, maintenance, insurance, and possible repairs then total these figures. It may be worth looking into to consider an extended service better known as an extended warranty if you plan to keep the vehicle a long time. Make sure to arrange for financing in advance by shopping around and always know how much you can spend for the auto. Just because you see a good deal, does not mean you may be able to afford the monthly notes.

When searching for a used auto on your own and not at a dealership, consult a service like carfax to see if the car has been in an accident and to make sure the owner has a title to the car. Ask to see the current car registration to check for ownership and to see if the registration is paid and up to date. Ask if there are any liens on the car or if it was leased. Take a good look at the car during daylight hours and not night. Do some inspections yourself or you could get an opinion of an auto mechanic. Always test drive the auto on the highway to make sure the car accelerates smoothly. Make your offer contingent on a good inspection.

When you want to use a dealership to get an auto, make sure to take your time and evaluate all options. A quick decision could cost you later by not having an auto you like. Be sure to find the look, the style, and the color you want - even if you must order it. Make sure it will still cost the same as the autos on lot. Review the price, make sure it fits into your budget, and be sure to understand all details. Review all the possible costs that come with the purchase. Depending on the state, there may be sales tax added. By knowing all the costs, you can determine what you can afford and how much you may need to borrow.