Whether you’re shopping for a used car at a dealer or plan on purchasing a vehicle from an individual or private party, a private used vehicle loan offers an ideal financing solution. You’ve just gone to great lengths to secure the best possible price for a vehicle, so you’ll want to ensure equally great auto loan rates as well.
How can I get a private used vehicle loan?
Private used vehicle loans from both brick-and-mortar and online financial institutions offer a greater variety of loan options and terms. They also help those who would rather not face a used car salesman by making person-to-person auto sales convenient and easy.
The Steps to Securing a Private Used Vehicle Loan Are Simple and Easy:
Find a great used car you love, or take advantage of an online loan calculator to determine a comfortable private used vehicle loan scenario. Pre-approvals are a great way to speed up the purchase process.
Complete a private used vehicle loan application for your chosen vehicle or loan amount at a qualified lender. Approval timespans vary, from same-day approval to up to 2 weeks for some private lenders.
- Work Out the Details
After your test drive, review the previous owner’s maintenance records as well as the vehicle’s history by purchasing a report. If you are satisfied, arrange an independent mechanic inspection from a source unrelated to the dealer or individual seller. Then, agree on a final sales price to determine your loan amount. Your lender will also have to ensure the vehicle is approved for sale and meets necessary financing requirements.
- Sign Documents and Arrange Payment
Sign the loan documents for the exact borrowed amount on your chosen vehicle. Then follow your lender’s instructions for transferring funds to the seller. Sometimes this means a transfer to a bank account of your choice, from which you can make the necessary payment to the seller for your purchase. In other instances, the seller may receive payment directly from your lender.
- Handle the Paperwork
Purchases from a used car dealer are simple, with the dealer helping you complete and submit necessary paperwork. For private party purchases however, the transfer of ownership paperwork is your responsibility, and must be completed within 6 days of purchase. Both you and the seller must work together to ensure all the dots are connected from financing to sales tax and proper registration, including applicable area safety and emissions tests.
Want to know more about how to get a great loan? Here are 5 tips to improve your credit score for a lower rate.