Can I get a car loan for a personal matter if I'm not actually buying a car?
I need money for a personal matter, but finding a signature loan is proving difficult. I was pre-approved for a car loan at 7.5% vs. almost 12% for a signature loan. Can I get the car loan without any interest in buying a car?
Apr 27, 2021
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Answered at Apr 27, 2021
“No, you won’t be able to get a car loan without the intention of buying a car. The first thing the lender will ask is what car you’re planning on buying. You’ll also need to show proof of car insurance before you can take out the loan.
If you already have a vehicle that’s paid off, you can often get a loan with the car as collateral, provided it’s worth $5,000 or more (figures will vary by lender). However, this doesn’t always work.
If you own a home and have enough equity built up, you may also have an opportunity to get a home equity loan. The interest rate on this should be three to five percent, based on current rates.
If neither of those works, a 12% signature loan isn’t all that bad, as some can have interest as high as 15% to 20%. At the very least, you’ll build up some credit in the process.”
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