How Private Party Auto Loans Work
A person-to-person auto loan is when you buy your vehicle from a private party, not a dealership. This type of financing has some of the same characteristics as loans for dealership purchases. However, there are also some key differences.
Loan terms
Private party auto loan terms tend to be less than buying a new car from a dealership. New auto loans are typically offered for as long as 72 months. On the contrary, the maximum available loan term for private party auto financing is usually 48 months.
**Please note that the longer you finance your vehicle for, the more money you are going to pay in interest over the entire life of the loan. Therefore, try and finance for as short a time as possible.
Interest rates
The interest rates associated with person-to-person car loans are usually higher than new or used car purchases from dealerships. It is very common for interest rates to be as much as 2% higher than new car dealer purchases and 1% for used cars. What interest rates you receive will ultimately depend on your credit rating and history.
**It is recommended that you obtain a copy of your credit report before applying for any type of auto financing. You need to make certain that all of your information is 100% accurate and current.
Down payments
Most auto loan providers will not require any sort of down payment when applying for a loan for either a dealership or private party purchase. However, a good rule of thumb is to try and put down no less than 20% to avoid becoming upside-down on your auto loan. Meaning, you wind up owing more than the car is worth.
Taxes, title and registration
The fees associated with taxes, title and registration can be combined into the final loan amount when buying from a dealer. However, these fees can not be combined into your person-to-person loan. You will have to pay these fees out of pocket.
Name on title
When you buy a car from a dealer, your name is put on the title the instant you sign the papers and make the deal official. However, when buying a car from a private seller, it can take as long as two weeks for your name to be placed on the title of your car. This happens because it sometimes takes the seller's lender some time before they fully complete the payoff process.
In conclusion, it is important to understand how private party car loans work. When you buy a car from a friend, family member or even a stranger, it is likely you will get a good deal. However, as mentioned, interest rates associated with private party auto loans are higher. This means that you may end up paying more for the vehicle as a result.
Related Tags: bad credit, car loans, no credit, auto financing, person to person auto loans, car financing
Jacob Joseph is a financial expert for http://www.starloanservices.com. At Star Loan Services you can get a free copy of your credit report.
Your Article Search Directory : Find in ArticlesRecent articles in this category:
- Payday Installment Loans: Ideal Funds That Supports Your Impending Needs
Any impending monetary crisis will be tough to deal with, if you are not having adequate funds. Neve - Educational Loans -helps To Secure Bright Future
Education is said to be the most important thing in ones life. It not only helps to improve the stan - One Hour Payday Loans No Faxing - Fastest Option Of Acquiring Money
Nowadays, loans have become a common thing among the UK people as needs are rising while the salary - Tenant Loans - Instant Monetary Support For Non Homeowners
Are you looking for an unsecured financial help that does not demand security to place against the r - Payday Loans No Faxing - No Verification And Delay
So many times, the approval of the loan gets delayed due to the lengthy paperwork and documentation. - Bad Credit Car Loans -helps You Finance A Car
Are you in need of a new car? Here bad credit car loans can offer you finance as you need. Perhaps y - Logbook Loans - Friendly Deal For Car Owners
Everyone knows that logbook is a paper issued by driver and vehicle licensing agency. This important - Same Day Loans For People On Benefits - Quick Money For Instant Financial Hold
Urgent and unpredictable demands might arise at times when you are not financially prepared. To deal - 3 Month Payday Loans - Feel Free With Longer Repayment Option
Are you looking for the loan that can give you small cash, but for longer duration? Are you worried - Loans For Bankrupt People - Look Forward For Financial Stability
Financial acronym or injury and inability for reimbursement to the concerned are known as insolvency
Most viewed articles in this category:
- Unsecured Personal Loans - Loan for the Common Man
Loans can broadly be divided into two types - unsecured loans and secured loans. Secured personal lo - High Risk Unsecured Personal Loans at Nominal Interest Rate
Today, unsecured loans gave grabbed the market as more and more people are opting for it. The loan m - Personal Loans-Don't Suppress Your Financial Needs
Personal loans can be segregated into a secured and an unsecured loan option. If you are a homeowner - Take the Loan; Show No Reason
If you are in need of a loan and want to utilise it for any purpose without showing the reason to th - No Compromise With Your Pleasure, Have Your Own Car
On a fine morning, you get up to see the sun shining brightly in the sky, leaving the world bathed i - Subsidized And Unsubsidized Student Loans!
These loans carry different loan terms and different requirements. According to the student situatio - Interest Rate: The Key Factor on Car Loans!
There are such wide variations in APR between lenders that you can end up overpaying on your car loa - Fight Against Tight Financial Situation With Personal Loans UK
It is always better to prepare yourself for unforeseen or unexpected expenses. If you are not born w - Advantages And Disadvantages Of Lack Of Security On Loans!
The unsecured nature of these loans attracts tenants but homeowners as well. However, in order to de - Unsecured Personal Loans-A Loan Everybody Is Eligible To Procure
Unsecured personal loans cater to urgent day-to-day financial requirements, and have become very pop
