What to Know about Classic Car Financing
An increasing number of people are putting their time and money into restoring classic Corvettes as a hobby. There is nothing like finding an old vintage or classic car and starting a restoration project. Whether it is a new paint job or new motor, classic cars (Corvettes especially) are considered a work of art for most. Many people are looking at classic Corvettes for sale for the first time either as an investment, hobby or to actually drive (gasp!) as their daily transportation. Classic cars can be more affordable than most brand new cars these days and they are also more enjoyable and exciting to restore.
Unless you have enough cash to buy a Corvette outright, classic car financing is one way of getting your hands on that dream. For those who are interested in financing classic cars, there are a few items to consider before purchasing. It is highly recommended to factor in all the necessary aspects of financing in order to make the right choice.
Crunching Numbers and Research
The first step is to determine how much you can afford to put into the purchase of a Corvette or other classic car. Whether you are paying in full with cash or doing monthly payments, you want to make sure that you can afford your new purchase. Once you crunch some numbers and do all your calculations, you’ll feel comfortable and better prepared to start browsing Corvettes for sale at auction.
While some people have their ultimate dream car in mind already, others are not sure about which model to buy. It is always a good idea to conduct some research and figure out what model you prefer and from which decade.
Inspecting the Car in Person
If at all possible you should try to see the Corvette in person. Depending on the value of the car a plane ticket can be much less expensive in the long run then rushing into buying the wrong car because you didn't see it first hand. Barring a personal viewing, a professional inspection is highly recommended for any classic car and should be performed before money actually changes hands between you and the seller. The last thing any buyer wants is to end up with a classic car that's plagued with problems. During the bidding process this is something you should negotiate with the seller. Insist that you be able to personally inspect the car, or at least have a mechanic check it out before you make final payment. eBay sellers should understand that it's a risk buying a car sight unseen and that if you've gone through the effort and expense to fly to a distant city then you're serious about buying the car. If they honestly represented the car then they should not be worried that you'll back out after you've seen it in person. At the most you may be required to make an earnest deposit, which helps protect the seller in case you're just a tire kicker. But full and final payment should never occur until after you (or your representative) has seen the car in person.
The condition of a car is critical for the amount of money you will have to pay in the long run. Experts advise prospective buyers to purchase a car in as good a condition as they can afford. It is one thing to be involved in a restoration project over the course of time, but it's another to have to unexpectedly pay for a new engine or to fix poor paint and body work.
But even before you find your dream car, you should do your homework and line up a your financing. Once that's in place you can worry about inspections, finding a Corvette transport company, etc.
Classic Corvette Loans
Classic car loans are not the same as regular loans, partially due to the involved process of determining the real value of vintage and classic cars. For this reason, some lenders do not work with classic car loans.
It is possible to find a general lender to finance the car, but classic car buyers are advised to go to a specialty lender. Specialty lenders are more informed about classic cars and know how to determine the fair market value. Be it a Corvette or other classic car, determining the true market value is critical to financing. Most general lenders are only familiar with pricing using Kelley Blue Book or similar guides. But these are for newer cars and don't cater to the specialty market of collectible and classic cars. True, there are many fine collector car value guides, which are a great start when you're trying to determining general value of a car you're looking to bid on. But to find the true value, the car should be appraised by an expert who specializes in classic cars. You can find a local one through the yellow pages. Appraisals can vary from one another; therefore, it is important to seek a couple appraisers for competing prices.
In addition, specialty lenders can provide loans that go up to 10 years rather than three or five. It is not always a good idea to extend a loan that far, but the option is there.
In order to apply for a loan, you must know your credit score. A good score is necessary for obtaining a loan with ease and comfort. While it is possible to get a loan before you find a car, it is recommended that you decide exactly which car you want.
Regardless of a loan, most lenders require a down payment in cash, which depends on the credit score as well. Once you have been approved for a loan and you have found the car of your dreams, take the effort to find out if the seller has the title to the car. In order to acquire the loan, the seller must have the necessary title.
A final factor to consider is a car inspection before the loan is approved. An inspection will determine whether or not the car is original and if you are paying the right price. This information is also important for the lender, who wants to ensure that the loan is equal to the value of the car.