What is an "Instant Car Loan"?

An instant car loan is guaranteed as long as you meet minimum credit or income requirements. Instant car loans are often called "guaranteed" or "pre-approved" loans for this reason. Instead of requiring a lengthy application, these loans use relatively few criteria and a simple algorithm to determine if you qualify and at what rate.

Benefits of an Instant Car Loan

Most people choosing this route value the decreased hassle and increased efficiency of the instant loan process. They do not wish to negotiate with lenders or meet face to face. These borrowers either have a high credit score or a high income, making them immediately qualified. Low income borrowers or low credit borrowers may also qualify, but they will face very high costs as a result.

Risks of an Instant Car Loan

Better loan options are usually available through negotiation; taking an instant loan results in high rates and less favorable terms. If you value the efficiency enough to spend the extra money, this may not be a problem for you. Further, borrowers who may not qualify for a more traditional loan can use this option to gain financing very quickly. Electing convenience over sound financial judgment, however, is not often the best idea in the long run.

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