Financing and inusrance help?

Question

I haven't bought a car before and Im gonna buy this used SUV thats 3,000 dollars from this used wholesale car place and was wondering how does financing work like do I have to talk to my bank or something or do I pay monthly bills to the dealer at a %age. And also do I have to have proof of insurance in order to register it at the DMV in my name?

Answer 1

Normally you cannot get financed by a bank for a vehicle loan under $10,000. If the company is a "Buy here, pay here" they may finance you. You may or may not be required to carry full coverage insurance for a "Buy here, pay here" lot. I strongly recommend having any vehicle with a purchase price of under $5,000 professionally inspected before purchase and getting a carfax report on the vehicle.

Yes, you must have proof of insurance to register the vehicle.

Answer 2

Well when I went to buy my car, the dealerships finance office did the applying for me. I was approved by Bank Of America, but again the finance office did it for me (as with everyone else).

Whatever lender grants you the loan, will typically send you a monthly bill and a return envelope.

As with insurance, the dealership requires you to have full coverage (until it's paid off) before it can be driven off the parking lot. As this would be a huge liability for them, if you got into a car accident.

WIth the DMV, I'm not sure if you necessarily have to have active insurance to simply register it under your name, that would be unnecessary.

Remember, I did all of this at a NISSAN dealership. I'm not sure of the protocol of a small "mom & pop" dealership. My only recommendation is that you call and ask.

Answer 3

Check with the dealer first. They likely have biz relationships with local car finance companies. Ask them if they deal with any credit unions, those usually have the best interest rate, and just require you to open a savings account there with like $5 bucks in it, or something. And yes, you have to show proof of insurance to register the car.