How do I get a loan for a secondhand car?

My brother wants to sell me his car at a steep discount, but I still don't have the cash for it. Can I get a loan for a secondhand car?

A secondhand car is the same as a used car for the purposes of a car loan, so you may be able to secure a car loan depending on the vehicle you’re buying from your brother.
If the car has less than 100,000 miles, is less than 10 years old, and has an actual cash value of $4,000 to $5,000 or more (depending on the lender), the car should qualify. If it doesn’t meet this criteria, you may have to go with a personal loan. Also known as a signature loan, a personal loan is an unsecured loan, meaning it doesn’t have any collateral. Interest rates will be higher, but it may give you the money you need for the deal.
Then, you’ll want to see if you can qualify for a loan. To qualify you’ll need steady income, good credit, and a debt-to-income ratio of about 43% or less. If you have all of these, you’ll also likely qualify for a loan. You should apply to several lenders so you have a choice of the best option.
If you’re going to get a loan, remember that you’re going to need full coverage car insurance. Thankfully, finding the right product at a good price is easier than ever. Hop on over to the Jerry app, which allows you to compare car insurance rates from up to 50 of the top insurers in the industry.
Eric Schad
Answered on Oct 21, 2021
Eric Schad has been a freelance writer for nearly a decade, as well as an SEO specialist and editor for the past five years. Before getting behind the keyboard, he worked in the finance and music industries (the perfect combo). With a wide array of professional and personal experiences, he’s developed a knack for tone and branding across many different verticals. Away from the computer, Schad is a blues guitar shredder, crazed sports fan, and always down for a spontaneous trip anywhere around the globe.

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