Personal Loan vs Auto Loan

[Ryannn]

I want to buy this 1970 Bronco, and I need a $4,000 loan. I am 18, with a stable job at Interstate Batteries. I have zero credit. What am I in for? What is a good interest rate? Please help cause Lord knows you guys have bought your fair share of vehicles.

-Ryan

 

[ronclark]

I hate to say but all the credit unions i have dealt with will not loan on a vehicle older than 10 years old.
that said your best bet is going to a credit union and see if thy will give you a personal loan but its going to be around 10 to 12%
and being 18 not sure if that's going to be a problem, I am betting your going to need a co signer with good credit to get you going

 

[84bluebronco2]

I hate to say but all the credit unions i have dealt with will not loan on a vehicle older than 10 years old.
that said your best bet is going to a credit union and see if thy will give you a personal loan but its going to be around 10 to 12%
and being 18 not sure if that's going to be a problem, I am betting your going to need a co signer with good credit to get you going

Speaking from experience with both auto and personal loans from a credit union, they base it off of a combination of your actual credit, and your credit with the institution itself. I got my first personal loan at 18, but it was for $600. The union I use wouldn't give me a loan for the full value of the vehicle if it wasn't within the last 5 years.

For my first auto loan, they said my credit (both with the union, and independently) was beyond good enough for the loan I was asking for, but I'd need a cosigner for at least a year before I could refinance without a cosigner.

Just some tips for you bud.

 

[Sasquatch_Ryda]

Perhaps a line of credit?

 

[TheBobmanNH]

Speaking from experience with both auto and personal loans from a credit union, they base it off of a combination of your actual credit, and your credit with the institution itself. I got my first personal loan at 18, but it was for $600. The union I use wouldn't give me a loan for the full value of the vehicle if it wasn't within the last 5 years.

For my first auto loan, they said my credit (both with the union, and independently) was beyond good enough for the loan I was asking for, but I'd need a cosigner for at least a year before I could refinance without a cosigner.

Just some tips for you bud.

This. Get a cosigner if you can. You're probably going to get a lower rate with an auto loan vs a personal loan, but research your options and find out if that's true for you (or even a possibility). Also keep in mind insurance - if you don't plan on carrying full insurance on the truck, if you get an auto loan they will probably require you to. Usually for such an old vehicle it would be chump change, but given your age I'm sure insurance is a bitch.

 

[merace19]

Just to be honest with ya, unless you can turn it and sale for a lot more, you should save up and pay cash. Credit is s 2 edged sword that you hold by the blade. 1/2 the country is in hock up to nose with credit issues. But you do need credit as you get older for home purchases and new cars. But if you have college degree they take that into account and usually loan you what you need with a reasonable interest rate. Small loans of 600-1500 paid off on time and never miss payments starts but will take years to do what a degree can do the second you get handed that paper. My wife had never had any credit, never bought anything in her name. She got her nursing degree and was able to get 2 credit cards of 20k each and a new car with that 1.9% interest.
But if you still bent on doing a loan, most banks will not loan on a car or truck that does not book out for more than what you borrowing. Example 4k truck they want it worth 5 k or that you put 1k down on it. They feel if you willing to put money down on it, the more likely you are to keep paying on it. But Older junk, is just that to them.
So you really stuck with a personal loan. those are the worse type other than credit card. Higher interest because nothing securing it, and its based on the borrowers credit worthiness. 12% is closer to the norm but could be 22%. banks are not taking chances like they use to.
MY final words on this. save you cash and buy when you got the amount it takes, and get a damn degree.

 

[adsm08]

You won't get an auto loan for that. I am aware of no institution that will issue a loan for a car that old, unless it is an immaculate, restored classic. Even then you end up with a special kind of loan.

But a personal loan will have a higher interest rate as the bank will see it as having no real collateral.