Buying a car is not an easy decision. It is even more confusing when you are planning to buy a used car. The used car industry is growing by leaps and bounds and a lot of consumers prefer spending their hard earned money on a used car as compared to a brand new car. With a used car, you will be able to purchase a premium model at the cost of a new car. However, you need to be very careful when choosing the used car. First of all, you need to pick the right dealer for the purchase. The dealer should be a genuine auto enthusiast who has knowledge of the auto parts and can guide you into making the right decision.
Check the condition of the car and take a test drive. You need to pick a car that does not require a lot of maintenance. Since you are buying a used car, a test drive will be important to understand the functioning of the engine and the performance of the car on road. The test drive will help you make the right buying decision. Once you have decided on the car you wish to purchase, you need to scout the market for lenders. There are a number of Banks and financial institutions that offer used car loans at lucrative terms. Consider the features of the loan and understand the terms and conditions offered by them. You need to keep in mind that the loan is available for every type and brand of the car but it should be less than eight years old. You will not be able to enjoy car financing if the car is more than eight years in age. Used car loan interest rates will be higher as compared to a brand new car loan because there is higher risk associated with the same.
There are special offers and discounts you can take advantage of in case of a used car loan. Compare the used car loan interest rates offered by different lenders and then make a decision. Choose a lender with a low interest rate so that you can manage the repayment with ease. The loan has a long tenure which will make it easier to repay the same. You can use the EMI calculator to determine the EMI you will have to pay each month. You need to provide the loan amount and the tenure to calculate the same. This will give you an approximate amount which will be your monthly outflow. You need to keep in mind that the loan will not be approved for the entire purchase amount, hence, you will be required to make a certain amount of down payment on the same. The balance can be converted into the loan. If you have excess cash on hand, you should make a larger down payment so that the loan amount is lower and you have to pay lesser interest on it. Used car loan interest rates vary from time to time and from one financial institution to another. This is why it helps to scout the market and carry out thorough research before you get yourself into the contract. Understand the penalties and the cost of processing of the loan application well in advance. The entire process of application is simple and straightforward but you can only apply for the loan once you have made up your mind about the car you want to purchase. This will help you determine the amount of loan you need and the down payment you can manage to make.