Out of State Car Financing
Brian Tucker, MBA
In unstable economic times, consumers tend to get creative when it comes to major purchases. Regional economies dictate the costs of major ticket items: cars, homes and rental properties and these items vary in price, from region to region. Is it feasible to purchase a car in another state? According to Consumer Debt Expert, Steve Rhode of the Huffington Post, Looking to Finance a Car, securing auto financing is going to be easier, for 2013. This should hold true for consumers interested in securing loans for used cars.
Being in California and having family in Nevada, I’ve seen price differences in car prices that made me strongly consider purchasing a car in the state next door. And it makes sense if you’re going to save thousands and pay hundreds in used car shopping in other states. Considering purchasing a used car in another state consider this checklist:
- Shop Locally – Look locally for securing a loan, first. A financial institution can issue a loan regardless where the dealer is geographically.
- Credit Unions require larger down payments, but you will get better interest rates than if you go with a national bank. If you’re a veteran or active duty member of the Armed Forces utilize branch credit unions for a better rate and overall deal.
- Use Vehicle Financing as a last resort – BMW Financing or Lexus Financing is guaranteed to be a higher interest rate. This route makes more sense for new car than a used one.
- Using national banks – Allybank and USAA make the process easier.
- Inspect the vehicle – take the vehicle to an independent third party mechanic – if doable. If not, Ask for a Carfax Report
- Never Send Money – I can’t believe there are stories out there of people putting cash in envelopes – this is a no brainer.
Securing financing for an out of state used car is doable, just make sure it is practical. How much are you really saving, if you’re purchasing out of state? Have you exhausted all options within state? Am I getting the best possible deal for the money I will be borrowing? If the best possible deal is out of state and what you will save outweighs what you will spend in transportation and other expenses than securing financing out of state for a used car makes sense.