How to Find Affordable Pre-Approved Used Car Loans for First-Time Buyers
Hawthorne Auto Square, a leading used car dealership in Los Angeles, is committed to helping find affordable pre-approved used car loans for first-time buyers. Since the pandemic, prices have fluctuated dramatically, creating challenges for buyers in the used car market. Reduced inventory and rising interest rates have also left many people discouraged. To make the process less stressful, we’ll look at the latest information and provide advice on finding affordable deals, from comparing used car prices to getting pre-approved for a used car loan, to make the process less stressful.
The Latest Trends in Used Car Prices
Used car prices reached record levels during the pandemic. In Q3 2023, the average used vehicle was priced at $28,935, according to Edmunds. That’s a drop from 2022 but significantly higher than five years ago when the average used vehicle cost $20,085.1 However, the cost of new cars has risen. The average difference between new and used car prices is the same as in 2019. Therefore, buyers on a tight budget can still find a bargain.
However, affordability remains a concern due to increased borrowing rates. Bankrate data shows that average used car borrowing rates increased to 7.3% in November 2023 compared to 3.85% in February 2022.2 As wholesale used car prices trend downward, many who purchased vehicles a couple of years ago are finding themselves underwater in car loans. But despite unprecedented price fluctuations, it’s possible to find an inexpensive used car and a loan you can afford.
How to Get the Best Value for Your Money
In such a challenging used car market, it can be hard to find the best value for your money. Your odds of doing so are better if you:
- Compare Used Car Prices: You can compare the price of a used car with similar models on various websites. Edmunds is an effective research tool. You can also use our Edmunds Trade-In Value Estimator to find the price of a vehicle’s make, model, and year. It provides insights that let you know if any quote you get is above, below, or at market value.
- Search Multiple Dealerships: Getting the best price on a used car may require shopping around. If a local dealership doesn’t have the lowest price, check online with other dealerships’ websites. Perhaps you can find a better deal in a nearby city or county and also find a more affordable pre-approved used car loan. First-time buyers often skip this step, but it can help you save over the long run.
- Consider Another Vehicle: Your first choice isn’t always the best one. To lower your monthly payment, consider a higher-mileage or older model. Many popular cars, trucks, and SUVs are known for their longevity. Get the vehicle history report and have a mechanic inspect a car before you decide to purchase it. Passing on a car with potential issues will avoid spending on repairs. Downsizing to a smaller vehicle can also help you save.
- Get Pre-Approved for a Loan: Getting pre-approved for a car loan allows you to see what loan amount and interest rate you qualify for. You can do this with Hawthorne Auto Square and we’ll help you find a car you can afford in our inventory. You’ll also know your monthly payment amount. Obtaining a pre-approval is beneficial if you’re building your credit and helps weigh your loan options.
- Trade-In Your Current Vehicle: Although used car prices are falling, your car may have equity that can help offset some of the purchase price of your next vehicle. Use our Edmunds tool to find its True Market Value. This is determined by the make, model, age, mileage, location, and original and current market pricing. However, a trade-in isn’t the only way to lower your monthly payments. You can also put more money towards your down payment.
Visit Hawthorne Auto Square
We’ll be glad to help you find an affordable pre-approved used car loan as a first-time buyer. While falling prices and rising interest rates are creating challenges, we can help you find a low-interest loan and a great deal on a pre-owned car. Use our simple online form for instant pre-approval and view our inventory to find the car you need and want. For more information about our vehicles, warranty, and financing options, visit our Los Angeles buy here, pay here used car dealership, or call (866) 707-7664 today.
Sources:
Get approved
It only takes a few minutes and won't affect your credit.
- Pre-Inspected Cars
- Clean Title
- Under Warranty