An auto loan is a type of personal loan used to purchase a car. It is also called a car loan or auto financing. This type of loan has the advantage of being simple, fast, and easy to get. If you need a vehicle but do not have enough savings to purchase a vehicle upfront, then an auto loan could be a helpful form of finance, as long as you can afford the repayments.
An auto loan is a type of secured loan, which means that the car or an automobile you buy is collateral for the loan. If you fail to make payments on time, a lender might repossess your car and sell it to pay off the loan. Make sure you can afford your monthly income before buying a car.
Types of Auto Loans