What is a reasonable interest rate for a used car loan?
Gale F asked:
I plan on purchasing a used car from a local dealer, and go shopping at several car dealerships. What is, in your experience, a reasonable, most used interest rate for the car loan financed through the dealership?
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I plan on purchasing a used car from a local dealer, and go shopping at several car dealerships. What is, in your experience, a reasonable, most used interest rate for the car loan financed through the dealership?
October 12th, 2009 at 1:52 pm
The newer it is the lower the rate…..if its like a 2000 model it would be about 7%……Again it just depends on other issues to…..Hope u get a good rate……. BUD
October 13th, 2009 at 7:17 pm
Your credit profile is a major factor that determines the interest you’ll pay for a used car loan. Presuming your credit profile is better than most, you’ll probably pay around 9% to 12%. If you finance through a car dealership (BAD MOVE!), you’ll pay about 15%. Other factors are the age of the car and the lender you choose, length of the loan, etc.
Always arrange your own financing through your bank or credit union. Dan B
October 14th, 2009 at 10:46 pm
A few factors come in play when one determined the rate for a car loan.
The first a foremost would be your fico score. Most lenders use a tier system to grade loan risk. A second factor would be the term of the loan. A shorter term should hold lesser risk so a lower rate should be warranted. A third factor would be the loan to value ratio. Most lenders use NADA Guide as a rule. You can go to bankrate dot com and get a national average which one could compare to a local credit union, a great alternative to using the captive lenders used by the dealerships. creditease