Auto loans can be used to purchase new and used vehicles. Most auto loans are secured loans and require the borrower to uses the vehicle being purchased as collateral for the loan. Unsecured auto loans do not require collateral but often come with higher interest rates. Auto loans typically come with a fixed repayment schedule, with a borrower making monthly payments over a set period of time until the loan is fully repaid. Loan terms can range from 12 to 84 months. Shorter terms mean higher payments but less interest. Longer terms mean lower payments but more interest.
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