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Classic Auto Loans

It is possible to get auto loans for the purchase of classic cars or collector vehicles. These classic auto loans are very different from normal auto loans.

Generally a person will have to go to a loan broker or lender that specializes in classic auto loans to get such a loan. Classic auto loans will usually cost more and come with limitations not found on normal auto loans.

Generally a person will have to up 20% to 30% down in order to get a classic auto loan. An individual who uses a lender that specializes in classic auto loans might able to get around this requirement.

Sources of Classic Auto Loans

The easiest source of classic auto loans to take advantage of is a car dealer that specializes in classic vehicles. Most classic car dealers work with lenders and offer some sort of financing to customers. Unfortunately such dealers usually do not finance the purchase of classic cars from private individuals.

A person who wants to purchase a classic vehicle from a private individual will have to go to a loan broker or online for financing. There are loan brokers and online lenders that specialize in classic auto loans. These lenders can usually be located by typing the words classic auto loans into a search engine.

A person who owns a home or other piece of reality could be able to get a home equity loan for classic vehicle purchase. To get such a loan a person will have to have equity in their real estate. Equity is the amount by which the value of the property exceeds the amount it is mortgaged for.

Limitations to Classic Auto Loans

There are some serious limitations to classic auto loans that car buyers should be aware of.

Most lenders will limit the classic cars they issue loans for. The lender will review the make, model and age of the car before issuing the loan. Some lenders may require that their expert or mechanic examine the car before issuing a classic auto loan.

Many lenders will only issue loans for classic cars where there is a strong resale market. If the lender does not feel the car could be resold they may not issue a loan for its purchase.

A buyer will probably be required to have some sort of loan insurance when they get a classic auto loan. Loan insurance pays off the loan if the classic auto is damaged, destroyed or stolen.

How Classic Auto Loans Work

A classic auto loan works just like any other auto loan, the vehicle purchased serves as collateral for the loan. This means that the lender has the right to seize the vehicle if the buyer doesn’t pay the loan off. Persons who buy collectors vehicles with classic auto loans should be aware that the vehicle can be repossessed if they can’t pay the loan.

Only persons with a lot of disposable cash should take out classic auto loans. Individuals on fixed incomes and low incomes should avoid classic auto loans because they are expensive.

Generally it is best to buy classic vehicles for cash and avoid the hassles of classic auto loans.