Check Out the Steps to Secure Finance for Used Car Purchase
Used car loans are today picking up pace due to the widespread benefits that they offer to the borrowers. For one, they allow you to purchase your desired car model at lower costs without creating a lump sum financial liability for immediate payment. As in, finance for used car purchase allows you to defer the vehicle’s cost, which is then payable in instalments over an agreed tenure.
As these are secured advances, interest rates on used car loans are also reasonably affordable, making them accessible for individuals across the economic strata. These loans are also high-value advances, allowing an individual to choose the desired car model for purchase as per his/her financial standing. Availing a used car loan is easier than ever today. You must, however, take care of a few aspects for a successful loan application and approval. Let’s check out the steps involved in availing a used car loan.
Step 1: Decide on the Car Model You Plan to Purchase
The first step to take towards vehicle ownership through finance for used car is to decide on the vehicle model you need to purchase. Once determined, you can check the available second hand car options in the market, with cautious assessment related to the years of use, insurance coverage, etc. These criteria help determine a suitable car model option to purchase with the available financing.
Step 2: Assess Its Cost of Purchase and Resale Value
Next, you need to assess the cost of purchasing this selected car model. The cost must be in your budget so that you are able to repay the loan amount conveniently based on your financial standing. If it exceeds your financial capacity, you may miss out on the favourable loan terms, or lose out your application for the advance altogether. Also, consider the resale value of the vehicle as the availability of finance for used car purchase depends on this value only.
Step 3: Compare Interest Rates
Having determined the above-mentioned details, you can proceed to check out lender availability and interest rate levy on the available loan options. Make sure to compare lenders based on the interest rate levy to decide on the most affordable financing option. Accordingly, zero in on a few lenders for further comparison. When checking affordability of a used car loan, you must also compare other applicable charges on the advance to estimate affordability.
Step 4: Select Lender Based on Loan Features and Benefits
Once you have narrowed down the lenders based on interest rate levy, you can check out for other loan features like the maximum loan amount available, LTV on the used car loan, tenure flexibility, repayment options, and the likes. You can zero in on the best lender based on these parameters.
Step 5: Meet Eligibility Requirements
When you have decided on the lender to avail the finance for used car purchase from, you can proceed to check whether you meet the minimum eligibility requirements laid down by the lender or not. The standard eligibility requirements laid down for used car financing include age, monthly income, financial stability and residential status.
Simultaneously, you also need to check the document availability and arrange necessary documents before applying.
Step 6: Fill Up the Application Form
At last, fill up the application form with necessary personal, employment and financial details asked for. Along with that, submit the documents required for hassle-free loan processing.
When availing finance for used car purchase, sending your loan application online can be a smart decision as it eliminates multiple stages of application, reducing the processing time. You must also estimate the EMIs payable before applying so that the repayment remains affordable throughout the loan tenure.
