Read this tip to make your life smarter, better, faster and wiser. LifeTips is the place to go when you need to know about Used Auto Financing and other Auto Loans topics.
In order to qualify for financing a used car or new car, most financial institutions will require a down payment of between 20 and 25 percent down. The lending agency will authorize a maximum amount, referred to as a finance value or loan value. The value will qualify the borrower for a specific car model and year. Generally, the finance value is approximately 25 percent less than the normal retail value of the vehicle. As a result, the loan value or finance value are excellent ways to gauge the affordability of the seller's asking price.