What is High Mileage Auto Loans
A High Mileage Auto Loan is when a driver currently purchasing a vehicle decides to cash out their previous vehicle and put it towards the new car or truck that will be purchased. This is often done to get rid of an older car with many miles and upgrades to find one with fresher models and more technology.
A high mileage loan is one of the best ways to get a good price for your current vehicle. You can get your money fast! If you need help deciding whether to take out a high-mileage auto loan, you can speak with a loan expert on this page.
How to Apply for High Mileage Auto Loans
You can go online to apply for a high-mileage auto loan, or you can talk to the lenders directly. You should call around and ask about their rates and services.
You have to get your credit pulled at least three times. Let’s say you are buying a used truck, and your car is being repossessed. The truck is worth $5000, and your car is only worth $1000. You have to apply for a loan at the bank for the truck. The bank will pull your credit and know that you just had a car repossessed in the past 3-12 months (which is how long it stays on your reports), and they will not loan you any money because you owe money on something else. You then go to an alternate auto finance company and apply again for a loan so they can pull another report. If that company doesn’t approve of you, you go to another financing company, etc.. until someone pulls your credit, which will increase your chances of being approved.
Requirements for High Mileage Auto Loans
- Proof from your down payment money or if you just paid cash, proof of the cash
- Proof certificate on a down payment or a logbook of down payments
- Proof of car insurance (Your parents or spouse’s information is okay)
- One or more valid drivers license
- A written contract of Sale
- Lease agreement
- Signed title
- Common Certificate (If it’s not CT or VA)
- Copy passport
- License, bank statement, or other current document showing your income
Risks of High Mileage Auto Loans
It is risky if you don’t have good credit and a big down payment. Take your no credit auto loan, for example. If you have a car that is only worth $1000 and it is being repossessed. The bank doesn’t loan you any money on the truck (which is worth $5000) because there is more room to lose, so the bank really isn’t loaning you anything. That’s where the auto finance companies come in. They will loan you money for the truck because they know less, and the lender will get most of the profit from selling it off in the future.
Benefits of High Mileage Auto Loans
High Mileage Auto Loans are great if you have bad credit or no credit and a big down payment. You can also apply for buying a used car that is fully loaded with an air conditioner, navigation system, DVD, satellite radio, and more. If you feel comfortable with that risk, then, by all means, find a lender that offers high mileage auto financing.
What is the Most Reliable High Mileage Car?
The most reliable car that can handle lots of miles is Honda. Honda has an engine that is much more reliable than any other vehicle on the market. Toyota has a close second in reliability. Any car you buy with over 100K miles will start to fail. The best thing is to buy a car under 50K miles and stick with it for 100K+ miles.