Can I use a car loan to buy something else?

I have a car that I own outright, but I'm interested in getting an ATV. Can I use a car loan to buy the ATV instead?

Answer
If you don’t have a car loan and you own the car outright, lenders will consider this as an asset or collateral to be used in a loan for another item such as an ATV.
However, this is highly dependent on the age and mileage of the vehicle. Generally speaking, the car will need to be fewer than 10 years old and must have less than 100,000 miles.
Some credit unions and banks may make exceptions if you’ve been a long-time customer. But if you’re applying for a loan with a new company, don’t assume that you’ll get the loan if you have an older car.
Some lenders also have loans specifically for ATVs, so that might be another avenue to consider. The interest rates are usually higher, but if your car doesn’t qualify for a loan, an ATV loan will almost certainly be cheaper than a personal loan.
If your car qualifies for a loan, make sure that you factor in full coverage car insurance into your budget, as the lender will likely require this as part of the stipulations of the loan. To help you save money, try using the number-one-rated car insurance app, Jerry. Jerry compares personalized rates from more than 50 top providers and delivers the best deals to your phone in minutes for free. The average Jerry driver saves $879 a year on car insurance!
Eric Schad
Answered on Nov 24, 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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