A car’s worth
Do you own a car and need funds? OAS FCU has a car loan just for you.
It used to be that when you had a car or wanted one, you had two loan choices: a loan to buy the car, and refinancing to improve your monthly payment through a lower rate.
Now there’s a third choice, the car equity loan
The car equity loan, explained
Say your car is 5 years old and its Blue Book value is $22,000. You have a bit left to pay on the dealership loan for it, about $3,000. OAS FCU can provide a loan over the equity of the loan, which in your case would be $19,000.
A vehicle’s equity is the value of the car, minus the balance of any car loan existing for it.
$22,000 (NADA value) – $3,000 (car loan) = $19,000 possible loan
In truth, OAS FCU can lend you, if you qualify, up to 125% of your equity. In the example above, that would mean you could qualify for a loan of up to $23,750. The loan has a repayment term of 5 years, or up to 7 if the car is less than 3 years old.
What’s a car equity loan good for?
You may spend the funds on whatever you wish: fix up the house, pay for something unexpected, tuition, or that long road trip that you always wanted to take.
From the financial standpoint these loans are great in that if you need a loan and have car equity, you get a loan for a much better rate tan if it were a signature loan only, which makes it cheaper, and you also might qualify for more loan than with your signature alone.
Will I be able to get this type of loan with any car?
The credit union’s car equity loans are for vehicles registered in the United States, 10 years old or newer.
I have an existing car loan: can I use an equity loan to pay that one off?
Of course! If the loan isn’t with OAS FCU, the credit union will need a payoff letter from your current lender, and part of your loan will go to pay that off. The remaining part of the loan would be at your disposal in your account to use however you wish.
Here are the links for refinancing your car loan the regular way, and for the car equity loan.