Types of used car loans
A used car loan is a type of car finance that’s used to help purchase a second-hand vehicle. Used car loans come in two main types: secured and unsecured.
With secured car loans, the vehicle you purchase is held as collateral against the finance. As a result, lenders will offer a more competitive interest rate – which can help save you money.
With unsecured car loans, you have more freedom on how you spend the money and no collateral is taken but as there is more risk for the lender, you will get a higher rate.
How to finance a used car?
Financing a used car can be different to a new car. First, you are often dealing with a private seller, not necessarily a dealer, which means there is additional paperwork, considerations and effort required.
When it comes to lenders, finance providers have conditions around their used car financing terms which can often be complex. The good news is we have years of experience in making this simple.
Features of a used car loan?
- Flexible contract terms ranging from 1 to 7 years.
- Choice of fixed or variable interest rates.
- Cash or trade-in may be used as a deposit.
- Tax deduction is available when the vehicle is used for business purposes.
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