Guide to cheap car loans and financing when buying a used car
Financing a used car: Dealer or bank?
Many car dealers, just like banks, offer competitive financing for used cars. Whether you should choose the dealer's offer or the bank's depends on how good an offer you can get and whether you prefer to have all your loans consolidated with your bank.
Loans and financing with no down payment?
If you prefer to put 0% down, this can usually be arranged even though most banks and dealer financing plans typically require around 20% as a down payment. However, putting nothing down will typically result in a higher interest rate on the loan.
What does a car loan cost?
The APR (Annual Percentage Rate) is the most important figure to look at when comparing car loans. The APR takes into account interest, fees, set-up costs, and other loan expenses, giving you the true 'total cost' of the loan.
How do you get the cheapest car loan?
The cheapest car loan in terms of interest charges is typically achieved by making a higher down payment. At the same time, there is a lot of money to be saved by comparing loan prices and interest rates online.
Online car loan calculators — how to use them
If you want to find out the price or interest rate on a car loan for a used car, the best thing you can do is use one of the many online car financing calculators. The price of a car loan is typically calculated by the bank based on your income. It also depends on the car's purchase price, whether you're making a down payment, and whether you can provide collateral.
Applying for a car loan
Many banks offer online applications for car loans. You will typically need to submit tax returns and payslips before you can be approved for the loan.