Can I Finance an Older Car?
Yes, you can get finance for an older car with Vendor Finance, but the terms and conditions may vary depending on the lender. Here’s what you need to know:
Factors That Affect Financing Older Cars:
- Vehicle Age:
- Most lenders have age limits for the car at the start or end of the finance term (e.g., the car must be under 10 years old when the finance ends).
- Some specialist lenders may finance cars older than this, especially classic or vintage vehicles.
- Car Value:
- Financing older cars can be challenging if the vehicle’s value is very low, as lenders may see it as less secure.
- Lender Policies:
- Banks, credit unions, and finance brokers each have different criteria, so it’s worth shopping around.
Types of Finance Available for Older Cars:
- Hire Purchase (HP):
- Often used for older cars, as the vehicle serves as security for the loan.
- Ownership transfers to you after all payments are made.
Eligibility Criteria:
- Car Condition:
- The car must be roadworthy and pass an NCT test (for cars over four years old in Ireland).
- Deposit:
- Some lenders may require a higher deposit for older vehicles, typically 10–30% of the car’s value.
- Your Creditworthiness:
- A good credit score and proof of income increase your chances of approval.
Documents Needed:
- Valid ID (e.g., passport or driver’s licence).
- Proof of address (e.g., utility bill or bank statement).
- Proof of income (e.g., payslips, tax returns).
- Vehicle details, including age, mileage, and condition.
Key Considerations:
- Interest Rates:
- Rates for older cars may be higher, as they are considered a higher risk due to depreciation and reliability concerns.
- Loan Terms:
- Loan durations may be shorter for older cars to ensure the vehicle retains value over the term.
- Insurance and Maintenance:
- Factor in potentially higher costs for insuring and maintaining an older vehicle.