Dealership Financing vs. Line of Credit
Thinking of Using Your Line of Credit to Purchase a Vehicle?
Here are the top 6 reasons why NOT to:
- Floating interest rate – fluctuates with the prime rate.
- The bank has the right to withdraw money from your account to pay for your line of credit
- Secured lines of credit use your home as collateral. Default of payment for any reason allows the bank to take your home.
- The bank may require the total balance of your line of credit paid in full if you die, become insolvent or bankrupt.
- If the bank sees any increase in risk to the security they can demand full payment.
- Home insurance costs may be higher due to the additional line of credit.