What to choose? Used Car Loan or New Car Loan
Many people have a tight budget who cannot afford a new car loan, but they can go for a used car loan.
Car loans are secured loans, which means, the value of the car is collateral for the loan, and if you don’t pay, the lender takes the car. As cars lose their value very quickly and in case of a used car, the lender cannot determine the value of the car, so lenders charge higher interest rates on used car loans.
Used car loans are available in the market, but you have to shop hard around for a loan to suit your needs best. Used car loans are available in the market for people of all credit types.
Best option to get a used car loan is to contact directly to the lender who is expert in used car loans. The lender can also help you in choosing the right used car.
Once you selected the car, then the dealer will take care of all the paperwork with you. You can also search online for a used car loan companies, and you can apply online.
You can also find used car dealers online, there are plenty of them, and you can make a choice. You should decide first which car you want to buy and choose the best dealer accordingly.
Some experts say that one should avoid new car loan because interest rates are very higher in this case.
Chart Showing Interest rates of used car loan and new car loan by different banks are:
Used Car Interest Rate
New Car Interest Rate
15.25% – 17.75% (60 months)
15.75% – 18.25% (24 months)
16.50% – 18.50%
11.50% – 14.75% (36-60 months)
13.75%-16% (24-35 months)
15.75% – 17% (Upto 23 months)
16.50% – 18%
State Bank of India
16.95% (Uoto 36 months)
17.20% (Above 36 months)
Kotak Mahindra Bank
11.50% – 13.50%
17% – 20%
Bank of India
Before buying a used car, you should take some precautions. Choose a car, which is 2-3 years old.
You should be extra careful about the repayment schedule in case of the used car loan. You can also make a search through various online sources available and can choose the best one.
COMPARE AND GET THE CHEAPEST CAR LOAN NOW!