If you have your eye on a used classic car or late-model vehicle, don’t miss your opportunity! Here’s how to get the best car loan for a used car.
Buying a Used Car? Here’s How to Find the Best Car Loans
An insider’s guide to car finance for second-hand vehicles
The used car market is full of hidden gems, from classic cars to affordable late-model vehicles.
Buying a used car can be a great way to save money on a vehicle with low kilometers or find your dream project car.
Of course, buying second-hand comes with a few risks.
That’s why finding the best car loan is such an important consideration when buying a used car.
With the proper preparation and research, you can confidently buy a used car knowing that you’re saving money for repairs, modifications and road trips.
Thankfully, finding the right financing is easier than scouring the second-hand car market for a diamond in the rough.
Here are our practical tips to help you get a better deal on a used car.
Do your research
Used cars rarely come with a warranty.
While that might scare some people away, it shouldn’t be a problem if you know what you’re buying.
As you narrow your car search, look through online forums, consult car fanatics and chat with your mechanic mate.
You’re looking for:
- Common mechanical problems
- Age-related service requirements
- Rare or expensive parts
- Mechanics’ familiarity and confidence with the car
- Recalls or recurring issues
Factor any possible repairs into your car finance calculations.
You can use a car loan calculator to see if the total cost (i.e. the list price plus mechanic fees) is still within your budget.
Check the vehicle
Now that you’ve found a used car within your budget, consider whether a pre-purchase inspection is necessary.
Vehicle inspections cost from $100 to $400 (as a general guide), depending on the car’s age and condition.
It’s not an insignificant amount of money.
However, if you’re taking out a car loan, you want to avoid any unexpected costs that could jeopardize your ability to repay the money.
So a pre-purchase inspection is a relatively small price to pay for peace of mind and confidence in your car purchase.
Read the fine print on your car loan
So you’ve found your second-hand car, researched affordable car financing, and conducted a pre-purchase inspection.
What next?
Before signing on the dotted line, make sure the terms and conditions of your financing suit your lifestyle.
For example:
- Can you pay out the loan early without penalties?
- Is your lender reliable?
- Do you need more time to accumulate a better credit rating?
- What are the penalties for missing a payment?
If a car loan seems too good to be true, it likely is.
The best car loans are simple, straightforward, and free from sudden interest rate spikes or hidden catches.
Shop around for car finance
Just like finding the best-used car, finding the best car loan requires research and patience.
You don’t want to rush into a lemon of a loan.
However, unlike vehicles, you can often test-drive car finance options online in minutes.
The best car loan providers like WA’s Yes Loans offer fast online pre-approval with no commitments, so you can shop around for a loan that suits your lifestyle.
Consult at least three loan providers, and remember to read the fine print carefully.
Get a better deal on car finance
With patience and a level head, you can easily find a car loan geared to your lifestyle.
So while you’re shopping for your dream used car, keep your budget and future costs in mind.
Car finance options abound – but you’ll know the best car loan when you see it.
