How to Find a Used Car Bank Loan Value
The used car bank loan value is different from the Kelley Blue Book value. Although the Kelley Blue Book is useful when deciding whether the price of a used car is reasonable, the bank uses additional criteria when determining the amount of a used car bank loan. Banks base some of their decisions on the vehicle's history and condition while other factors include the applicant's personal and financial history.
Instructions
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Examine the used car to determine its condition and then find its corresponding value in the Kelley Blue Book. The car must be mechanically sound and have a good likelihood of continued use for the life of the loan. Banks place a limit on the age and mileage of cars that qualify for loans so check with your bank before committing to buying a used car.
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Pull the vehicle history from CARFAX to learn if the car has been in an accident or totaled in another state as this will have a significant impact on the bank loan value. A car does not have to be in an accident for the insurance company to declare the vehicle a total loss. The insurance industry writes off vehicles as complete losses for damage from flood waters, mudslides, hurricanes, tornadoes and other natural disasters.
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Check your credit history with all three of the major credit bureaus: Experian, TransUnion and Equifax. The bank will look at your credit history, so any delinquencies or debt that show up will have a significant effect on the amount of the used car loan.
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Gather all of your loan and credit card statements to determine two things: the amount of your total indebtedness and your monthly payments on these debts. The bank will look at the ratio of your total indebtedness to your income to decide how much money it will offer as a used car bank loan. You must also show that there will be enough monthly income to make the loan payment on top of your other debts.
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Shop around at different banks and credit unions for the lowest interest rate. A lower interest rate translates into a lower monthly payment. This could potentially allow you to obtain a larger used car loan.
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Show the bank where the down payment will be coming from if the money is not in your savings account. Borrowing money for the down payment will have an effect on the bank's used car loan value.
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Tips & Warnings
Dispute errors on your credit report before applying for a bank loan. This will raise your credit score and possibly qualify you for a lower interest rate on the loan.
CARFAX reports are fairly comprehensive but do not include accidents or vandalism for which no insurance claim was filed.
References
- Photo Credit Classic American Sportscar image by kenmo from Fotolia.com
