Easy Auto Loans at Best Auto Loan Rates from ... - Financial Resource

July 20th, 2011 by rachel12

Private?auto loans?are offered to car buyers who decide to buy a used car from its owner. In such cases an authorized dealership is not involved in the buying and selling process and it is between the owner of the car and the buyer that the entire negotiation happens. When it comes to the terms of private car finance it is quite different from regular auto loans. Private car loans require the individual to repay the loan within a shorter term period that is within 48 months plus the rates on such private auto loans is also higher than offered in regular car loans.

Despite having a shorter period of repayment and higher interest charged on the private?car loan?this type of car financing is the best alternative for subprime borrowers, students and first time car buyers. The reason why private car loan can be considered beneficial for subprime borrowers is because the total cost on a used car will be much lower than that on a new car. The price of a used car is much lower than that of a new car and so the total amount of private auto loan required is also significantly lower. This automatically reduces the monthly installment for all those buyers. Secondly, another major point that drives subprime borrowers and students towardsprivate car finance?is that the depreciation curve of a used car is slower than that of a new car. This means that the rate at which the value of a used car depreciates is slower than the rate at which a new car depreciates. Since the depreciation is slower in a used car the difference between the purchase price and the sell off price is significantly lower than the difference in a new car.

Since the depreciation curve is lower on a used car the borrower gains from the bargain as he is in a better position to recover the money spent on the car which is not possible in a new car. Used car financing or private car loans are secured at the best rates from online car loan lenders. This type of financing if availed from online lenders will enable the borrowers to secure easy auto loans without much hassle. However, whether one wants to opt for?private auto loans?is completely up to the individual.

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This entry was posted on Wednesday, July 20th, 2011 at 3:40 am and is filed under Financial Planning. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

Source: http://www.financialresource.org/blog/easy-auto-loans-at-best-auto-loan-rates-from-online-lenders/

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