Private Party Auto Loans-Do A Bit Of Homework

Buying a used car can take a lot of time, but if you are willing to do a bit of homework, you can get a great deal on a great car. Besides, with how much money you could end up saving, it's not wasting time but rather investing it. There are several options that you can explore, and getting private party auto loans is one of those options. 

The local car dealer is the first stop for a large number of people. For some reason they feel reassured knowing that the dealer has looked at the car and has also made it ready for sale. Now, most dealerships are fairly honest, but remember that it is always in their best interest to downplay any problems a car may have. That means you should never assume that a car is in top shape just because a dealer says so.

While a car dealer could, in theory, cover up some problems, there are laws in place that are meant to protect the consumer. Furthermore, most dealerships will give you a few days in which you can return the car if it has problems. However, this does not apply to private parties that are selling a car. 

Convenience is another reason why some people prefer going to a used car lot to purchase a set of wheels. A private party will have only one car for sale, and if you don't like you will have to go somewhere else. Car dealers, on the other hand, will have several cars for you to choose from. If you don't like one car all you have to do is stroll over to another one on the lot.

Most people are well-aware that a car dealer sells cars at a profit, and they assume that's how car lots make most of their money. While there is no doubt that straight car sales are important, many dealerships rely on financing for a large portion of their profits. So, you can buy a car you like and get a loan right at the dealer. Talk about easy, right? Right, but...

Getting a loan at a dealership will cost you money. They are professionals at making you feel like you're getting a deal, when in reality you are paying much more than you would through private party auto loans. A private party is only looking to make money on the sale of the car, not on financing.

But what if you need to actually get a loan from a private party? Now, you're not going to find a seller that will loan you money as that would be far too risky for them. The only exception to this is if you happen to be buying a car from family or friends. Even then, they may not allow you to make payments. The question then becomes should you borrow money from somebody else to buy a car? Generally speaking, you should not do this. If you do, then you will be adding another person to the transaction, and that's another opportunity for something to go wrong. However, there are always exceptions. You must have a signed and written agreement any time you use private party auto loans. This will protest you and the other person if something comes up.