Should I get a car loan or a personal loan to buy a Subaru Crosstrek?

"I can pay off a loan in a year, as I'm going to receive an inheritance. However, I don't know which type of loan to get.

For a Crosstrek, is it better to get a personal loan or an auto loan? How will each affect my credit score?"

Answer provided by
Eric Schad
Answered on May 21, 2021
“Both personal and car loans are installment loans, so they should affect your credit in the same way. Therefore, one isn’t better than the other with respect to raising your credit score.
You should think about interest rates. If you have even a halfway-decent credit score, a car loan’s APR is about 3% to 5%. A personal loan is anywhere from 12% to 18%.
If you want to pay the least amount of interest over the coming year, a car loan will save you money on top of increasing your credit score.”

Did this answer help you?

Ask us a question by email and we will respond within a few days.

Have a different question?

You can meet us at our office and discuss the details of your question.

Easiest way to compare and buy car insurance

No long forms
No spam or unwanted phone calls
Quotes from top insurance companies