Used Car Financing Options

Vehicle financing is a process by which a business purchases an asset for use in the future. Car dealers offer financing options to customers and captive lenders who loan money to the dealers. Those looking to get the best deals on their car purchases can consider using used car dealer financing, private party financing, or e-finance, each of which provide unique benefits.

Here are five things to consider when looking for the best used car financing options:

The Market for Used Cars

Used car dealerships are an integral part of the automotive industry. Dealerships want to sell cars so they offer customers a range of financing options. Private party sellers are also often willing to work with potential buyers to find financing solutions.

Used Car Financing Process

Financing options for used cars in tucson can be grouped into two categories: captive and independent. Captive financing is offered through the dealership itself using the dealer’s own capital and any loans from banks or financial institutions. Independent financing is provided by outside lenders, such as banks and credit unions, who are not affiliated with the dealership in any way.

Used Car Financing Program

Programs offered by captive lenders use the car itself as collateral and include the following financing options:

  • Trade-in program – A customer can trade in a vehicle for a used car. The price difference will be used to pay off the current loan.
  • Purchase program – A customer can sell their own vehicle in exchange for a used car from the dealership. The trade-in price and amount financed are listed on the sales contract.

Private Party Financing

Private party financing is available for those who buy their used cars from private sellers. The seller and buyer can negotiate financing terms and often the seller will agree to finance a percentage of the sale price as part of the transaction.


Most dealerships do not accept e-finance applications, but many will work with customers on financing solutions that can be completed online or over the phone. The dealership will then help complete the paperwork and submit it to an outside lender for approval.

Used car financing options can help customers save thousands on their car purchases, whether they are buying their first or last car. Check with local dealerships to see what financing options they offer or use the Internet to compare different types of used car financing.

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