You generally have two main paths when borrowing for a vehicle:
Auto Loan vs. Personal Loan: Which Should You Use to Buy a Car? need a loan to buy a car
: Lenders look at your existing monthly expenses to ensure you can afford the new payment. 3. Use the "20/4/7" Rule for Affordability You generally have two main paths when borrowing
Financial experts often recommend the to avoid overextending yourself: : Most borrowers who qualify for standard rates
: These use the car itself as collateral. Because the lender can repossess the car if you default, they typically offer lower interest rates than personal loans.
: Most borrowers who qualify for standard rates have a score of 661 or higher . While you can still get a loan with lower credit, your interest rates will likely be much higher to cover the lender's risk.
: You typically need a stable job or business for at least two years and proof of a minimum monthly income.