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Can I get a loan on a car I own?
I’m doing some home improvement projects, but I’ve run a bit short on cash. I don’t really want to dip into my savings because I’m earning a decent return. I own a car outright and I’ve read that you can get a car loan on it. Can I get a car loan on a vehicle I already own?
Eric Schad · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
As long as your vehicle is less than 10-years-old, has less than 100,000 miles, and is in good condition overall, you can get a
car loan
on a car you already own. Many people do this, especially when they’re getting a higher return on their savings or investments compared to an auto loan rate.Also known as auto equity loans, these types of loans allow you to borrow up to what your car is worth based on a lender’s assessment. However you don’t have to borrow the full amount. For example, if your car is worth $10,000, you can borrow $10,000, but you could also borrow $5,000 or any other amount.
However, auto equity loans often have higher interest rates than traditional car loans. Plus, they aren’t always quick to close. If you can’t get a quick auto equity loan or you have poor credit, consider other alternatives such as:
- A payday loan
- Title loan
- Personal loan
- Credit card
- Borrowing the money from friends or family
As a subtle reminder, the lender will almost certainly require you to carry full coverage car insurance on your vehicle throughout the duration of your auto equity loan. Therefore, you should definitely shop around to get the best rate via the Jerry app.
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Jerry partners with more than 50 insurance companies, but our content is independently researched, written, and fact-checked by our team of editors and agents. We aren’t paid for reviews or other content.
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