Is it easier to get a used car loan or a new car loan?
I'm trying to decide if I should get a new car or a used car. Which one is easier to get a loan for?
Regardless of whether you want a used car or a new car, lenders use the same determinants for approval. Credit, debt-to-income ratio, and income all play vital roles. But in some circumstances, getting a used car loan may be easier or more preferential. This has more to do with lower prices for used cars, which translate into lower monthly payments that fit better into your budget.
When budgeting, don’t rely solely on the monthly payment. For a used car, you’ll have to factor in more maintenance. While repairs may cost less for a new car, you may also have to purchase full collision or comprehensive insurance as dictated by the lender.
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