The key to obtaining a loan for purchase of a car is relatively similar to any other type of secure loan.
The vehicle you are purchasing must be worth the amount of money you are borrowing or more. You must put some money down. That varies  according to the lender and your credit.  Some dealers offer no money down incentives (smoke and mirrors).  There is always some sort of cash exchange as far as the banks are aware of.

Auto loans are promissory notes. Like a contract they have a starting and ending day, as well as a payment schedule to commence at specified dates for the specified amounts.

As a smart consumer, you should pull your credit before purchasing a car, because knowledge of your credit standing is important when purchasing a new or used car on credit.

Be sure to pull your credit reports, and scores.  Repair, and correct any negative information on your reports.


Know where you stand and know the average interest rates for your credit profile before stepping one foot into a car dealership!

  

 

Most dealers get commissions for using certain banks. Some of the sub prime rates benefit the dealer by ways of commissions.  They prey on your ignorance. That is how everyone makes their money. When stupid people make it easy for them. You are not stupid. You can control a lot more of the situation than you think.

Also a dealer can come back to you and say they can not get you a loan on a particular car, but they can get you financed on another car instead because of your credit. They use that trick in order to move a car that has been sitting too long, or higher commission on that car for some reason.  At least then you know you should walk away all together.

$20,000 Financed for an auto loan. These averages were taken from FICO based on average rates across the United States for September 22, 2009. This should be taken as advice only. The rates adjust daily, so it is important to get the average rates fico.com, or bankrate.com.

 * 720-850 6.342% $390

690-719 7.848% $404

660-689 9.828% $423

620-659 12.783% $453

590-619 17.660% $504

500-589 18.456% $513

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Another good thing to remember when purchasing a used car, especially if you do not enjoy working on them is to purchase a good warranty package for major repairs.