Can I use a personal loan to buy my car?

Is there any way that I could use a personal loan to buy a new car? I’m worried about missing a payment and my car getting repossessed. A personal loan seems like a better option for me.

Answer
You can use a personal loan to buy a car, but it might not be the cheapest way to purchase your vehicle. Personal loans tend to come with high APRs, which could result in you paying thousands of dollars more in interest for a personal loan than you would for a car loan. It can also be more difficult to qualify for a personal loan since you’ll need excellent credit.
However, there are advantages to taking out a personal loan to buy a car, like:
  • Reduced risk of repossession: You won’t have a high risk of repossession like you would with a car loan since personal loans won’t require a lien on your car.
  • No downpayment: Personal loans won’t usually require a downpayment like car loans will, so you’ll be able to purchase your car without paying a large sum upfront.
Regardless of how you decide to purchase your car, you’ll need to get an insurance policy for it, too. The Jerry app makes it quick and easy to find the best rates available on the insurance coverage you want! Just download the app and answer a few questions to see a comprehensive cross-analysis of the best car insurance policies that work for you and your new vehicle.
Liz Jenson
Answered on Dec 02, 2021
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