Can I get a surety bond for a car loan?

Answered by Car Loans Expert Eric on January 15, 2021

Denise asked

I've heard that surety bonds can be used for certain kinds of debt. Do they extend to car loans?

expert avatar

Eric

Car Loans Expert

Surety bonds are typically purchased by a car buyer in the event that a car has a lost or stolen title. This ensures that you have a legal right to the vehicle, even if someone else procures the title or registration after you purchase the car.

However, banks and third parties can issue a surety bond that vouches that you’ll pay back a car loan if a lender is hesitant due to you having either no credit history or poor credit. If you have a limited credit history or poor credit, this is often one of the only ways to secure a car loan. Surety bonds often range from $100 to $1,500 for $10,000 worth of coverage. So while you’ll pay more upfront, you can often get approved for a car loan with the help of a surety bond.


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