A secured car loan is a type of loan where the borrower uses an asset such as the car you are about to buy as security against the loan. If you default on your repayments the lender can take ownership of your car.
Secured car loans are typically set at a low interest rate when compared with unsecured loans but it can also depend on the age of the car. Secured car loans are usually available for new or relatively new used cars, but check the loan details before applying.
Most borrowers choose to secure their car loan with their new car to get a lower rate. However, if you have a good credit rating, you may want to consider an unsecured loan, thus leaving the equity from your assets out of the loan. This is a great way for you to ensure you are investing in the right areas at the right time.
Make sure you consider your personal circumstances and financial situation before you start comparing car loans so that you can find one that is going to suit your individual needs.
You can compare great car loans and find some highly competitive rates by entering your loan requirements and reviewing the selection provided on our car loans page. Here you can also see the difference between secured car loans and unsecured car loans so you can have all the options at your fingertips.
Another great tip is to check out RateCity’s Car Loan Guide which will give you lots of handy hints and help you better understand the car loan market.