Collecting classic cars is one of the costliest hobbies around and it is a little trick to get a classical car loan. The price tag on such a baby is sure to cause a panic attack in many people. People found ways of getting a classic car loan despite having a normal budget that in certain circumstances would destroy their dreams of being at the wheel of a vintage beast. If you’re aiming at getting a classic loan but your budget is nothing out of the ordinary, you might find this guide very handy. Let’s take a look at the steps you have to take in order to get classic car loans on a tight budget.
Whether you’re dreaming of a Euro-chic 1961 Jaguar E-Type or an all-American 1963 Chevrolet Corvette Sting Ray, classic cars can give you a chance to own a beautiful piece of the past.
As you begin researching classic car loans, it’s important to remember that some lenders place age restrictions on the vehicles they finance. Since classic cars are generally much older than the average vehicle purchase, they may not qualify for a traditional auto loan.
In order to secure funding through a loan — should you need it — to buy your slice of automotive history, you may have to find a lender that provides classic car loans.
Credit unions and banks are not a good source of car loans, especially when you juggle with a couple of loans already. And even if they offer you the car loan you require, it will probably have a huge interest rate and it will be secured on your house. Private lenders, on the other hand, have a wide variety of car loans that come with affordable interest rates. What’s more, many of them are willing to tailor repayment plans for their clients.
You can find a private lender pretty easily. Just surf the Internet for a while and you’ll definitely find one. Stay away from lenders who ask for deposits or any other sort of down payment.
One that specialises in car financing, to be more precise; if you can’t seem to find a good deal, no matter how hard you try, such a broker can do some research and get back to you with one.
Moreover, a car broker can easily save you some funding, as well as the hassle of doing all the research on your own. Brokers collaborate with a lot of lenders. Sometimes you don’t even have to pay the broker because he works on a commission. In other words, if he gets you the dream-deal, he’ll get a certain sum of money from the lender he hooked you up with. This is how you save money by hiring a car financing broker.
Tons of classic car enthusiasts choose to lease vehicles and then purchase them. This works perfectly for those people who can’t afford to buy a classic car with a down payment or can’t find a lender that’s willing to hand them some dough. After leasing, you can purchase that vehicle outright and you’ll know for sure how efficient the car is and whether or not it’s as worth it as you thought it would be initially. This is the best alternative to car loans you have (and the safest, to be completely honest with you).
A Home Equity Line of Credit could actually provide you with enough funds to purchase the classic car you’ve been dreaming about for so long. Of course, you have to own quite a large, modern house that has a lot of equity in it. As you might know, a HELOC is a loan that’s secured on your house, which serves as collateral. If you fail to repay the loan, the lender can place a lien on it and sell it. The HELOC, therefore, should be your last resort. The Home Equity Line of Credit usually serves other purposes, but it’s totally possible to get a car with the money that comes from it.
You’ll have to determine if you want an unsecured loan or a secured one. Under a secured one, you’ll get more money and lower interest rates. Under unsecured car loans, you’ll get a more limited amount of money and higher interest rates. But then again, an unsecured loan doesn’t pose a threat to your assets. If you fail to repay it, the worst thing the lender can do is to sue you. Keep in mind that he can get the right to place a lien on your assets even in this circumstance.
Extra caution is therefore advised. You certainly don’t want to be living in a Cadillac, as cosy as it might be. Think twice or even thrice about this issue and make a decision you won’t live to regret after a while
A classic car loan is usually different than a standard auto loan, which will affect your funding options. Plus, you may need to seek out certain lenders to finance your dream car.
If you’re unable to qualify for a classic car loan, consider saving your money to make your purchase with cash down the road. Then you won’t have to worry about financing at all.
If you have any more questions or need further assistance, feel free to contact us. We’re here to help!
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