A growing number of people are selling of their old cars for the constant influx of new cars that are hitting the roads. Most people like buying a second hand car as compared to a new car after getting a drivers license. The idea is that it is always better to buy a new car after your skills are honed on a used car.
When the time comes to pay for the car, we look for cheap used car finance rates 2016. However obtaining finance for used cars is more difficult. The model and the age of the car play a major role in the financing decision of the car. Normally it is seen that used car loans are three percent more expensive than the new car loans. At best, you are bound to get approximately 75 % of the value of the car as the loan.
Age of the used car is critical
Getting finance for new cars is no big deal. However , when it comes to getting finance for used cars , then the age of the car is important in order to determine if you will get the loan or not . The model of the car plays an important role as well. If the model of the car has been phased out of the market, it is highly unlikely that you will receive the loan.
Most financers will first look at the tenure for which the person wants the loan and the age of the car before finalizing on it. The age and the tenure of the car should not exceed seven years combined. For example, if the age of the car is 2, then you can get a loan for five years. The cars, which are four or five years old, generally do not qualify for a loan.
Used car finance rates
Once the car has been identified, the bank sends an evaluation expert in order to calculate the value of the used car. The value will be dependent upon the number of kilometers run and the model of the used car. Based on the valuation, the bank will finance you. The used car finance rates 2016, will be a combination of the profile of the customer, his credit score, the after of the car and the make of the car.
Normally a customer will only qualify for 70 % of the value of the car as the loan. However, if the relations of the customer with the bank are good, he may qualify for 80 to 90 % of the value as the loan.