3 Situations Where a Personal Car Loan Can Help

Some people don’t realize they can either use a personal loan or an auto loan to finance a car.

Your choice should be based on your own needs and buying process. But there are certain situations where a personal loan just makes more sense.

While most people don’t take out a loan expecting to default, a changing financial situation could leave you uncertain. And if you default on your auto loan, you could lose your car.

But if you default on a personal car loan, it won’t be repossessed as collateral.

If you’re not sure what car you want to buy, it might be a good idea to take out a personal loan for the purchase.

This way, you’re free to shop around for what you want and make offers on several. You’ll have a little more leverage in negotiating because as far as the dealer is concerned, you’re paying cash.

Getting a loan for a car that has over 100,000 miles or has a salvage title can be difficult with traditional auto lenders.

In this situation, a personal loan is your best bet. You can use it for whatever you want, including restoration work and accessories.

A personal loan may not be the right choice for everyone buying a car. But if you need a little more leeway with how you spend the money, it’s probably the best one for you.

With a personal loan, you’ll have more negotiating leverage and you can take out more than you need to cover extras.