Can You Get a Loan to Buy a Classic Car? Everything to Know
Can You Get a Loan to Buy a Classic Car? Everything to Know
Posted on August 3, 2023
The classic car market is huge and very lucrative. That makes it difficult to get into if you’re an enthusiast. Whether you’re into classic Chevies or vintage Mustangs, buying one of these classics can cost a lot of money! So how can you finance it? Can you buy a classic car with an auto loan?
Classic Cars & Auto Loans
If you want to buy a vintage or classic car, you’re going to need to dig deep. Some classics easily reach six figures while less valuable options can still cost the high five figures.
If you don’t have that kind of money lying around, you’re going to need an auto loan.
Some lenders will provide auto loans for classics as long as the car’s provenance and value can be independently verified. Some lenders will require specialist classic car loans.
Getting Approval For a Classic Car Loan
Even though the amounts are potentially a lot larger, the process of qualifying for a classic car loan is much the same as for a standard loan.
Check Your Credit Score
The higher the amount you’re planning to borrow, the higher your credit score needs to be. Check your score and check your report while you’re there.
Make sure there are no errors on the report and that your current situation looks as good as it can. If you need to take remedial action, postpone the loan application for a while to ensure your score is high enough.
Allocate a Down Payment
You’re going to need between 10-20% of the car’s value as a down payment. Some lenders will work with 10% while others will insist on closer to 20%.
The more you can put down, the less you’ll have to borrow so it’s good news for you anyway if you can put more money down. That means lower monthly payments and less interest.
Get Pre-Qualified & Pre-Approved
Once you’re in a financial position to proceed, check your math with auto loan prequalification. This uses minimal personal information and a soft inquiry on your credit report to provide a quote.
The quote will tell you whether you’re likely to be able to get the loan or not.
Auto loan prequalification takes it a step further and queries a lender as to whether they would offer a loan to you or not. This uses a hard inquiry on your credit report so keep this until you find a deal you like.
Thanks for reading!