It’s not uncommon to have multiple car loans at the same time. In fact according to Experian “1 in 10 borrowers have more than one active auto loan.”
There are a few reasons why you might have multiple car loans. Maybe you’re still making payments on your old car while you’ve financed a new one. Or perhaps you took out a loan to buy a car for your teenager who’s now in college.
Whatever the reason there are a few things you should keep in mind if you have multiple car loans.
First remember that each car loan has its own interest rate and terms. So if you’re making payments on two loans you’ll need to budget for two different payments each month.
Second you’ll want to make sure you’re making the most of your money by shopping around for the best interest rates. If you have good credit you may be able to get a lower interest rate on your second loan.
Third keep in mind that having multiple car loans can impact your credit score. This is because your credit utilization ratio (the amount of credit you’re using compared to the amount you have available) will go up.
If you’re looking to take out a second car loan make sure you compare interest rates and terms from multiple lenders before you decide on one. And as always be sure to budget for your monthly payments so you don’t get in over your head.
Can I have 2 car loans at the same time?
You can but it’s not recommended.
What if I can’t afford the monthly payments on one loan?
You may be able to refinance your loans or trade in your car for a less expensive one.
Can I get a car loan if I have bad credit?
You may be able to get a car loan with bad credit but you will likely have a higher interest rate.
What is the minimum credit score needed for a car loan?
There is no minimum credit score needed for a car loan but a higher credit score will get you a lower interest rate.
How much money can I borrow for a car loan?
The amount you can borrow for a car loan depends on your income credit score and the value of the car.
How long does a car loan last?
A car loan typically lasts for 3-7 years.
What is the interest rate on a car loan?
The interest rate on a car loan depends on your credit score the length of the loan and the type of car you are buying.
Can I get a car loan with no money down?
You may be able to get a car loan with no money down but you will likely have a higher interest rate.
How often are car payments due?
Car payments are typically due monthly.
What happens if I miss a car payment?
If you miss a car payment you may be charged a late fee and your interest rate may increase.
Can I pay off my car loan early?
You can pay off your car loan early but you may be charged a prepayment fee.
What is GAP insurance?
GAP insurance covers the difference between what you owe on your car loan and the value of your car in the event that it is totaled in an accident.
Do I need insurance to get a car loan?
You will need to have insurance to get a car loan.
Can I use a co-signer on my car loan?
You may be able to use a co-signer on your car loan if you have bad credit or no credit.
What is the best way to shop for a car loan?
The best way to shop for a car loan is to compare rates from multiple lenders to find the best deal.
