How Does Used Auto Financing Work?
The decision to buy a car involves a lot of consideration
. Many a times people buy a new car, get fed up of it in a year or two and finally sell it at a much lower price than what they had initially paid for it. If you are one of those who those who like to change vehicle often, it is wise to buy a used car, taking into consideration the depreciation in the value of investment. Buying a used car is also the best decision an individual with low budget and urgent requirement of vehicle can make. A number of financial companies offer fast used auto financing on the Internet to individuals with bad or no credit.Used Auto Financing: How Does it Work?
Before you apply for used car financing, it is important to understand its working. The process involves the following:
Book Value Is Established: After you decide the car you want to buy and approach a loan company, it will first determine the car's loan value before agreeing on providing the loan. Most companies use the NADA Guide or The Kelley Blue Book to analyze the loan value of a car. Car loan providers typically do not offer loan more than the vehicle's loan value. If there is any difference in the loan value and the asking price, the loan seeker has to pay that in cash to the seller.
Loan Application: If the buyer agrees on the loan value, he files an application for the loan. The company will typically ask for borrower's identity proof, pay slip, credit report and proof of full-coverage car insurance. Such a loan is usually offered for a term of 36 to 60 months. Monthly payment is lower for a longer term loan. Later if he decides to increase the term of the loan, the interest rate will increase correspondingly.
Loan Is Finalized: On approving the loan application, the loan company will issue a check to the seller. The borrower then files another application for the transfer of the title of the car and gives a copy to the loan provider on getting the title. This is to ensure that the name of the buyer is listed on the title. The provider's name is put on the title under secured interest. After the loan is repaid in full, the loan provider gives a release of lien to the buyer.
In 2008, the sales of Toyota, Honda and Nissan used cars topped the sales charts in the USA. If you dream of owning a car, contact Autofinancingonline.com Financial Services provide to get used auto financing solutions for franchised automobile dealerships. Apart from low rate interest loan, the company also offers numerous payment options including telephonic transactions, pay-by-click and credit cards.
How Does Used Auto Financing Work?
By: orsondixon