Can I get a secured loan against my vehicle?

I want to use my car as collateral for a loan to pay down credit card debt. Is this possible?

Answer
Paying down credit card debt is always good for your financial situation—even if it’s with a secured loan.
The short answer is yes, you can use your vehicle as collateral for a secured loan. But there is one major requirement: you must own the vehicle or have positive equity in it.
  • If you own the vehicle, you can get a loan based on its actual cash value. As long as it’s less than 10 years old and has less than 100,000 miles on it, lenders should approve you.
  • If your vehicle is financed, you’ll need to have positive equity. This means your car is worth more than what you owe on the loan.
Another great way to pay down credit card debt? Saving on your car insurance costs! The insurance comparison and broker app Jerry will find you the lowest rates on the coverage you need so that you can put the extra money towards your credit card.
Eric Schad
Answered on Oct 26, 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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