A Secured Car Loan and How it WorksInterested in getting a secured car loan? You’ll want to do your research to see if it’s the right option for you. At Brilliance Honda, our financial experts have the information you’re looking for about secured car loans and how they work. Learn more about this special type of loan, and then apply for financing through our finance center. We can help you explore your financing options and get the right loan for you!
How Does a Secured Car Loan Work?
First, we have to answer the question: what is a secured auto loan? A secured loan uses collateral, normally the car itself, as security. This means if the payments are stopped, the car can be repossessed. In order to obtain one, you’ll first need to contact our finance department to start the application process. You might also be wondering: is a car loan a secured car loan? Not always. There are different kinds of car loans to choose from.
To complete the paperwork, you’ll need to provide personal information such as your name, social security number, and details about your current financial situation. You will also need to undergo a credit check in order to be approved. Lenders will review your credit history combined with your income to see if you meet the loan terms. If you qualify, this information will also help decide your interest rates. Once your debt-to-income ratio is determined, and if you meet the loan qualifications, you’ll be presented with the fixed rates of your loan.
Once approved, you can purchase the vehicle of your choosing. You must make regular payments on the vehicle until the loan is paid in its entirety. When the loan is paid off, the vehicle is yours for the keeping. If the car is not paid off, and payments stop, the vehicle will be repossessed.