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Compare car loans for used cars

Financing options to get behind the wheel of a new-to-you ride.

New cars are notorious for losing their value the moment you drive them off the lot — but you can take advantage of that depreciation by buying used. It can help you save money, and there are still plenty of loan options available. However, you'll want to carefully consider the vehicle's history before you buy.
Name Product Filter Values Minimum credit score APR Loan term Requirements
PenFed Auto Loans
Starting at 1.79%
3 to 7 years
Active membership with PenFed
Low APR car loans from a well-known credit union.
No minimum credit score
3.9% to 27.9%
18+ years old, annual income of $4,000+, no active bankruptcies
Get pre-qualified for used car financing and receive competitive, personalized rates. Car Loans
Varies by network lender
Varies by lender
Must be a US citizen with a current US address and employed full-time or have guaranteed fixed income.
Apply with a simple online application to get paired with a local auto lender. No credit and bad credit accepted.
CarsDirect auto loans
No minimum credit score
Varies by network lender
Varies by network lender
Must provide proof of income, proof of residence, and proof of insurance.
Save time and effort with this lending service specializing in beginner-friendly or subprime car loan.
Auto Credit Express Car Loans
Must be employed full-time or have guaranteed fixed income of at least $1,500/month and be a current resident of the US or Canada.
Get connected with an auto lender near you, even if you have bad credit.
Monevo Auto Loans
3.99% to 35.99%
3 months to 12 years
Credit score of 500+, legal US resident and ages 18+.
Quickly compare multiple online lenders with competitive rates depending on your credit.
Good to excellent credit
Starting at 0.99%
Varies by lender
18+ years old, good to excellent credit, US citizen
Compare multiple financing options for auto refinance, new car purchase, used car purchase and lease buy out. Car Loans
Starting at 1.89%
550+ credit score, no open bankruptcies, $24,000+ annual income, US citizen or permanent resident, 18+ years old
Get up to four offers in minutes through one simple application. Multiple financing types available including new cars, used cars and refinancing.

Compare up to 4 providers

3 ways to finance a used car

While there are a variety of ways to finance a used car, these are the three most common methods:

  1. Secured car loans. Most car loans use your car as collateral to secure the loan. This can help you qualify for a competitive rate, but you risk losing your car if you default.
  2. Dealership financing. Nearly every dealership you walk into will offer in-house or third-party financing to assist you in buying a car. These are typically also secured car loans, but often have less-strict credit requirements than you may find with other lenders.
  3. Unsecured personal loans. Unsecured personal loans are generally offered to customers with good credit. These loans don’t require you to use your car as collateral, but can result in higher interest rates and additional fees.

Is dealership financing worth it?

It can be, but you should still take the time to compare loans from banks and online lenders first. Dealership financing can be quick, but it’s often more expensive than finding financing through a third-party lender. Keep these points in mind when deciding whether or not you want to use dealership financing for your used car purchase:

  • Interest rate. Dealerships generally advertise low interest rates to get you in the door. But these are typically reserved for buyers with excellent credit. Getting preapproved at a few third-party lenders first can give you bargaining power when you hit the dealership.
  • Down payment. While a down payment isn’t necessarily required by dealerships or lenders, it can help reduce the cost of your loan. When you’re buying a used car, try to have a down payment of 10% to 20% of the car saved up — it can help you save big on interest.
  • Car price. Consider the overall price of your car. If dealership financing can help you score a lower interest rate, you still have room for negotiation. Walking in with a preapproved car loan offer already in hand can help give you an edge.
  • Extras. Extras like an extended warranty and additional insurance can impact your final loan amount, making it more expensive. Consider these carefully, and remember: No dealership or loan company can force you to take on optional features.

What are the limits on used car loans?

Lenders typically set minimum and maximum loan amounts, as well as limits to the age of the vehicle and how many miles it can have. Here’s what you can expect from some top car loan providers.

Loan providerMaximum age of carMinimum loan amountMaximum loan amount
Auto Credit ExpressNoneVariesVaries
Go to site
car.Loan.comVaries by lenderVaries by lenderVaries by lender
Go to site
myAutoloan.com10 years old$100,000
Go to site
LendingTreeVaries by lenderVaries by lenderVaries by lender
CarsDirectVaries by lenderVaries by lenderVaries by lender
Springboardauto8 years old
Bluesky Auto Finance8 years oldN/A$30,000

Should I put down a deposit on a used car?

Some lenders might request a deposit in three situations:

  • If you don’t have financing available after you negotiate the purchase price
  • If the dealership needs to order your vehicle from a factory
  • If the dealership needs to exchange vehicles with another dealership

In these cases, it may be necessary to leave a deposit for your used car, but that doesn’t mean you have to settle for the dealer’s terms. Every step of a car purchase can be negotiated, and that includes your deposit.

Tips for making a deposit on a used car

Keep these pointers in mind before leaving a deposit on a used car:

  • Make sure it’s refundable. Read the terms of your contract carefully and have a sales manager change it if you find that it’s nonrefundable. That way you can back out if the car doesn’t meet your standards after you have it inspected.
  • Make sure it’s not listed as a partial payment. Deposits should never be listed on your contract as partial payments — it’s not a down payment on your car.
  • Pay with a credit card. You can easily dispute the charge with your credit card company if you decide to not go through with the sale.

How do used car deposits work?

How to compare your loan options

Securing the right financing is as important as finding the right car. Here are the main components of a loan you should consider:

  • Interest rate. The interest rate directly affects your monthly car loan payment. Most lenders will offer a range of rates, so be sure to understand your credit score and confirm that the rate you’re given is actually a good deal.
  • Fees. Lenders can charge a range of fees on used car loans — termination fees, origination fees, loan maintenance fees and more. Review all the extra costs that come with your used car loan since these will impact your APR and the amount you end up paying overall.
  • Flexibility. Can you make additional and lump-sum payments during your loan term? Are you able to repay your loan early without penalty? Is there a grace period for late payments? Make sure your loan is flexible so it can mesh with whatever life throws your way.

Higher interest rates on used car loans

Used cars might be cheaper, but loans tend to come with higher interest rates. That’s because car loans are secured by the value of the vehicle you’re buying. Since used cars are worth less, your collateral isn’t as valuable. This makes lenders see you as more of a risk than a new car buyer, whose collateral is simply worth more.

Lenders tend to give borrowers with more valuable collateral lower interest rates because they stand to gain something more valuable if the borrower can’t pay back their loan.

How to use depreciation in your favor

Depreciation is often cited as the single largest expense when buying a new car. With over 40% of a new car’s value being lost to depreciation in the first three years, you can often find a better deal on a slightly used model.

Use sources like Edmunds and Kelley Blue Book to research the average price of the car you’re interested in. You’ll be able to see its original value and its estimated used value, which will then give you an idea of how much you should be paying.

By keeping depreciation in mind, you can use it in your favor to score a good deal. You’ll also be able to see the car’s estimated rate of depreciation, which can help guide you toward a car that won’t lose its value while you drive it — meaning you can sell it for a better price once you want to upgrade to a new model.

How to buy a used car

Follow these six steps to buy a used car.

Bottom line

Opting for a used car can help you avoid the depreciation that comes with buying new. But you’ll want to compare your car loan options before hitting the dealership to ensure you’re getting the best deal available to you.

Frequently asked questions

Check out even more information about used car loans with these answers to standard questions.


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