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Tata Capital > Blog > Loan for Vehicle > Different Ways of Financing a Used Car in 2023

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Different Ways of Financing a Used Car in 2023

Different Ways of Financing a Used Car in 2023

Let’s face it! The COVID-19 pandemic has made many individuals realise the necessity of a second-hand vehicle. Buying a used car is not only cost-effective, but it also keeps your family safe.

Moreover, a second-hand vehicle purchase gets you a car that otherwise might be outside your price range. Lately, the second hand car market has seen a spike in business, which has naturally led to several convenient financing options. 

So, if you are looking to buy a used vehicle, check out the following ways in which you can finance it.

Cash payment

If you have the money readily available, making a cash payment is one of the quickest ways to purchase a used vehicle. This will save interest payments on loans and is a swift transaction between you and the seller.

Used vehicle loans

You can apply for a used car loan by filling out an application which will be reviewed by a lending institution. Numerous factors, such as your credit score, income, etc. will govern the decision of loan approval.

However, before applying for a second-hand vehicle loan, you must calculate your payable EMI with the help of a used car loan calculator.

Know that smart buyers draw up an approximate budget, and research all lending options correctly before they walk into any dealership. This is the only way to ensure that you get the ideal financing to buy used car without burning a hole in your pocket.

Additional Read: How to Check for Used Car modifications and damages before buying one?

How can I ensure a used-vehicle loan approval?

Several factors make an individual an ideal borrower - like economic stability, family income, previous debts, etc. However, one of the most crucial parameters is your CIBIL or credit score.  

If you are looking for vehicle finance, make sure you have a healthy CIBIL or credit score as that enhances your overall used-car loan eligibility. A credit score of 670 is considered good, but to avail of incredibly competitive interest rates, try getting this number up to 740. You can achieve that by not defaulting on your credit card debt and repaying your previous EMIs on time.

Remember, all lenders will look at your credit score to determine whether you should be sanctioned a second-hand car loan.

Additional Read: Top Things to consider If you are planning to Buy a Used Car this Festive season

Are you considering a used car loan?

Before you go down this road, ensure solid research on lenders to get the best loan rate and repayment tenure. After which, you must access their website to calculate your potential monthly instalment with the help of a used car loan EMI calculator.

Are you looking for an ideal lending institution that can assist you with buying a used vehicle? If so, then put your trust in Tata Capital for your second hand vehicle loan.

We offer vehicle finance with flexible repayment tenures, minimal documentation and competitive used car loan interest rates. To know more, give us a call or log on to our website today!

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