Whether you purchase a new or used vehicle, buying a car is usually an expensive purchase. Often, you can take the time to save up for a new car, putting money into savings each paycheck. However, you might end up short if your current car breaks down unexpectedly or is totaled in an accident. If you need to get a car unexpectedly, here are some ways you may be able to finance it.
Dip Into Investments
Homeowners may have acquired equity in their property that can be tapped for a loan if needed. Interest rates on a home equity credit line are often lower than regular loan rates, so check with your local financial provider to see if you qualify for this type of financing. The application process and loan approval amount to a second mortgage, so be prepared to meet monthly repayments to avoid putting your home at risk.
Apply for a Traditional Loan
Many kinds of lenders, including banks and credit unions, may be willing to consider loaning you the money for a new car or used car purchase. If your credit score is in good standing, and you have a reasonable balance between income and debt, you may be eligible for approval of a conventional auto loan of this type. Interest rates will vary, along with loan terms and conditions, so make sure you fully understand the type of loan you are applying for before actually accepting it.
Look Into a Car Loan
Certain lenders specialize in car loans for used or new vehicles. This type of loan may be able to get approved faster than the previous types described above. Consult an auto loan lender for details on the type of loan you may be eligible for based on your credit record, your income, and other current financial obligations. Some types of auto loans can be approved on short notice, so this might be a preferable option if you need a vehicle in a hurry.
Sell Unneeded Items
You might be able to sell various items sitting around your home to obtain a down payment to buy a car quickly. If you cannot collect enough funding for the entire purchase, you could use the down payment to negotiate a car loan at possibly lower interest or a longer repayment schedule with more affordable payments. Collectibles like coins, guns, tools, jewelry, and other valuables can often sell quickly online or through a local vendor. Your current vehicle might also fetch a decent price for parts. Do an inventory of items that might be worth something toward buying another car.
Making big purchases on short notice is stressful, and an emergency purchase can be difficult to manage. However, it is often possible if you plan ahead for potential emergencies and keep these tips in mind.