How to finance an older car without high interest rates
As a Jalopnik resident car buying expert and professional car buyer, I get emails. Lots of emails. I have chosen a few of your questions and I will try to help you. This week we discuss financing slightly older used cars and whether or not a lifetime warranty applies to a lease buyout.
First of all, is it possible to buy an older car without a very high APR?
“I’ve been listening to podcasts on cars lately, and they sparked my interest in the second generation Porsche Boxster / first generation Porsche Cayman. These typically cost between $ 22,000 and $ 30,000 for moderate mileage. But these cars are also almost 20 years old, and the interest rates are pretty high for something from this vintage. These rates give you almost double that of that brand new (i.e. M240i or Supra). Are their financing options best used for cars that aren’t really classics, but aren’t really late models?
Also a bit along the lines of Porsches above, I played around with the idea of getting a well-maintained used Honda Prelude. Considering the rise in used car prices and demand for all things’ 90s and Japanese, these are exceeding book valuations. From what I can tell, lending seats won’t lend you more than the car is worth (that makes sense), but I’d rather not put my other two cars as collateral. These fall into the same boat of not really being a classic and not really being a late model. Are there any suggestions as well? “
Most banks don’t want to take out loans for older models because they see them as riskier, so they structure their interest rates to discourage buying older cars with loans.. However, some lenders specialize in vintage / vintage cars in addition to some online banks which allow more flexibility regarding the model year.
My clients have had great success with PenFed. This bank generally has no restrictions on model years and offers competitive rates. Hagarty has connections to some lenders on his website for people who want to finance an older car. One of these banks is LightStream and it can be a good option for people looking to buy any used car, regardless of age. Of course, you’ll want to have top-notch credit for the best rates, and it’s always beneficial to shop around for your loan with multiple lenders to compare your rates.
Then, do these “extended lifetime guarantees” apply to repurchased leases?
“I’m thinking of buying my rented truck. It came with a lifetime powertrain warranty. I asked the dealer and he said no because if I buy the truck I will be considered the 2nd owner. So I called Fidelity and she said no as long as I own the truck it stays with me. What do you think ?”
In this case, it is not really “what I think”, but rather the policy of the underwriter of the guarantee. If Fidelity tells you that the collateral stays with you and can put it in writing, it looks like you are clear. However, this may not be the case in all cases. Often times, dealerships will offer a “lifetime powertrain warranty” as a benefit for the purchase of their car. finish. It all depends on the language of the contract.
Got a car buying puzzle you need help with? Write to me at [email protected]!