In order to purchase used cars, individuals often have to apply for used car loans. Used car loans provide financial assistance to those who cannot afford to purchase a vehicle and pay the full amount up front. In most cases, individuals provide a down payment of $1,000 or more and the lender of used car loans pays the remaining balance to the dealership. This arrangement allows individuals to purchase a vehicle without paying the full amount upon receipt of the vehicle. However, these individuals pay off the remaining amount plus interest charges and fees over a period of time with monthly payments to the lender of used car loans.

Usually, individuals apply for used car loans when purchasing vehicles from dealerships, rather than from other individuals. Often times, lenders only work with dealerships to offer used car loans. Thus, if individuals are not able to afford used cars from other individuals who are selling them, then they should look for vehicles from dealerships. Dealerships often have many used cars, including vehicles manufactured from competitors. When persons buy new vehicles, they often trade-in and older vehicle to reduce the cost of the new one. Dealers then take these used cars and sell them to other individuals. By offering used car loans for these vehicles, much like new car loans, individuals have the opportunity to afford these vehicles, while the dealership makes profit from the sale.

Buying used cars from dealerships is usually a safer and better choice than purchasing from other individuals. Not only are there used car loans offered with dealership used cars, dealerships may supply a limited warranty and/or guarantee of the vehicle. This assures that the vehicle, if not fully functioning when purchased or within a certain period of time after purchase, will be fixed. Overall, used car loans are opportunities to purchase vehicles.