Does having two car loans hurt your credit?
Asked by: Thea Marks DVM | Last update: January 2, 2026Score: 4.6/5 (42 votes)
Is it bad to have two car loans?
Keep in mind that having two car loans at once typically means higher auto insurance premiums. Your credit score could also dip when you apply for financing, making it more challenging to qualify for credit in the near future.
How long should I wait between auto loans?
After you buy a car, you have to wait at least 60 to 90 days before you can refinance, since it takes about this long to transfer the title to your name. Generally, it's best practice to wait to refinance a car loan for at least six to 12 months.
How much is a $30,000 car payment for 60 months?
How much would a $30,000 car cost per month? This all depends on the sales tax, the down payment, the interest rate and the length of the loan. But just as a ballpark estimate, assuming $3,000 down, an interest rate of 5.8% and a 60-month loan, the monthly payment would be about $520.
How many car loans are too much?
You can have as many car loans as you qualify for, but it might not be the best choice. Lenders will take into account your income, credit score, and debt-to-income (DTI) ratio when deciding if they can give you a loan for a second vehicle. Make sure you can afford the monthly repayments on all your loans.
How Do Multiple Car Loan Inquiries Impact Your Score? Can They Be Removed?
What is considered a high car payment?
Your monthly auto loan payments should not exceed 10 to 15 percent of your pre-tax take-home salary. Due to increased vehicle incentives, drivers may find relief when shopping for a vehicle this year. To secure the best deal, work to improve your credit score and consider making a sizeable down payment.
Can you pay off a 72 month car loan early?
Some lenders charge a penalty for paying off a car loan early. The lender makes money from the interest you pay on your loan each month. Repaying a loan early usually means you won't pay any more interest, but there could be an early prepayment fee.
How much should my car payment be if I make $60000 a year?
A person making $60,000 per year can afford about a $40,000 car based on calculating 15% of their monthly take-home pay and a 20% down payment on the car of $7,900. However, every person's finances are different and you might find that a car payment of approximately $600 per month is not affordable for you.
How much is a $20,000 loan for 5 years?
A $20,000 loan at 5% for 60 months (5 years) will cost you a total of $22,645.48, whereas the same loan at 3% will cost you $21,562.43. That's a savings of $1,083.05. That same wise shopper will look not only at the interest rate but also the length of the loan.
What credit score do you need to get a 30k car loan?
A target credit score of 661 or above should get you a new-car loan with an annual percentage rate of around 6.7% or better, or a used-car loan around 9.63% or lower. Superprime: 781-850. 5.08%.
Can I cancel a car loan after signing?
Yes, it is possible to get out of a car loan, but there are only two ways to do it: satisfying the terms of the loan or defaulting on the loan (which can end up with your car being repossessed). Unfortunately, it's not possible to just give back a car and end the financing agreement as though it never happened.
Can I finance 2 cars on the same day?
In some cases, you might find yourself buying multiple cars back to back—or even at the same time. If you'll need financing to do so, you might be wondering: Is it possible to finance more than one car? The short answer is yes! There is no official limit to the number of car loans you can take out.
Can I trade in a car I still owe money on?
Can you trade in a car that has a loan? A common question we encounter is "will a dealership buy my car if I still owe?" It is definitely possible to trade in even if you are still paying your auto loan for that vehicle.
Can I lease a car if I already have a car loan?
A dealer may allow you to trade in a financed car for a lease, but you'll still be responsible for the amount you owe on your current car's loan.
Can I buy a house with two car loans?
But multiple big-ticket debts, like cars and homes, can signal to lenders that you're in danger of overextending your finances — because not only are you looking to borrow a large sum of money for a new home, but you are also adding a car loan to your monthly spending for the next three-to-six years.
What credit score do I need to get a $20,000 loan?
A minimum credit score of 670 to 739 is typically required for a $20,000 personal loan. Proof of steady income, including pay stubs, tax returns, and bank statements, is essential. Applicants must be at least 18 years old and legal U.S. citizens. A debt-to-income ratio below 36% enhances loan approval chances.
How much is a $25,000 car payment?
Example: A six year fixed-rate loan for a $25,000 new car, with 20% down, requires a $20,000 loan. Based on a simple interest rate of 3.4% and a loan fee of $200, this loan would have 72 monthly payments of $310.54 each and an annual percentage rate (APR) of 3.74%.
How much is 26.99 APR on $3000?
An APR of 26.99% on a $3,000 balance would cost $67.26 in monthly interest charges.
What is a good car monthly payment?
Financial experts recommend spending no more than 10% of your monthly take-home pay on your car payment and no more than 15% to 20% on total car costs such as gas, insurance and maintenance as well as the payment. If that leaves you feeling you can afford only a beat-up jalopy, don't despair.
What is the 20 4 10 rule?
The rule recommends making a 20% down payment on the car, taking four years to return the money to the lender, and keeping transportation costs at no more than 10% of your monthly income.
What are the disadvantages of a large down payment on a car?
Disadvantages of a Larger Down Payment
The two biggest cons of making a down payment that's around 50 percent are: More money down doesn't lower your interest rate – Bad credit car buyers get higher than average interest rates, and it's extremely rare that a larger down payment can lower it.
What happens if I pay an extra $100 a month on my car loan?
Extra payments made on your car loan usually go toward the principal balance, but you'll want to make sure. Some lenders might instead apply the extra money to future payments, including the interest, which is not what you want.
How long is the Capital One auto loan?
You can choose loan terms of 36, 48, 60, or 72 months to see how your monthly payment changes if your other variables stay the same. But keep in mind that while longer loan terms may have lower monthly payments, they also typically come with a higher interest rate.