June 17, 2009
What is the process of getting an auto loan and using it?
Christina B asked:
Im trying to trade in my 2008 chevy hhr for a 2009 Honda Ridgeline which is 33,000 and I am trying to get a auto loan too. I was trying to get a 15,000 to 20,000 auto loan. Do i have to pay both the monthly payment of the truck to the financing company that will accept and the auto loan?
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10:43 am
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It depends. There are a number of different ways you can go with this.
The method you are asking about would involve a cross-collateralized loan for both vehicles. This is generally considered a more risky kind of vehicle loan arrangement (if you miss a payment you’d stand to lose both vehicles).
Another way to do this would be to arrange each transaction separately. Do the trade-in first, as one separate loan. Then go either to the dealer (if looking for dealer financing) or to a bank or credit union of your choice to finance the 2nd vehicle.