Many office workers would prefer to forego public transportation and commute in their vehicles when state governments progressively lift the lockdown. Due to price constraints and the possibility of merely using the vehicle until the fear of covid-19 looms big, many customers prefer pre-owned cars.
According to a study conducted by the online listing platform OLX, 54% of consumers looking to buy a car in the next three to six months would prefer a used car. However, financing a second-hand car is tricky. The interest rates are higher in pre owned car loans than those offered by new ones, and each lender considers different factors.
Listed below are the best tips to get pre owned car loan at low interest rates
Check out financial institutions interest rates
First, see if the lender provides pre owned car loan. If you answered yes, the used automobile you want to buy must be approved for financing by the lender. Some lenders refuse to finance used cars that are more than three years old. Go to a lender’s website, either online or in person, to apply for a pre-owned car loan. You can get the best interest rate by doing some online research. Some lenders demand the borrower pay 20% to 30% of the cost upfront and then borrow the balance.
Check for a loan repayment facility
Once you’ve narrowed down your list of lenders, acquire specifics on the amount you’re eligible for and the term you want, as well as the interest rate and processing fee, and calculate your equal monthly installment. Check with the lender to see if there are any prepayment penalties. Many lenders impose a penalty if a quick loan on a pre-owned car is foreclosed. Some banks have flexible repayment arrangements.
Check your credit score
Some banks or financial institutions offer you lower interest rates on pre owned car loan if you have a good credit score. As a result, you can take advantage of your credit score. Check your credit score before applying for a pre-owned car loan. In addition, if you have a good credit score, you can request a lower interest rate from the bank.
It’s important to note that pre owned car loan interest rates are often higher than new car interest rates. The amount of money you can borrow is also determined by the lender’s estimate of the car’s value. Therefore, the loan amount is frequently smaller than the price you intend to purchase the vehicle.
While pre owned car loan can have a loan term of up to five years, the actual term granted by lenders is determined by the car’s age. If your LTV ratio is lower, your chances of getting a pre owned car loan are better. Moreover, you can check whether financial institutions allow an overdraft loan facility after obtaining a pre-owned car loan. The overdraft loan facility on your pre-owned car will help you in the future if you need money for an emergency.
2nd hand car loan are available at competitive interest rates with reasonable fees. All policies are transparent, so there is no surprise charge. You can get affordable interest rates on the best personal loan for a used car. So by using a personal loan app, you can take a loan on a used car in a hassle-free manner.