Car loan is a type of loan which is used to purchase a new or used car. It is also known as auto loans.

Features of Car loans are as following:

1. It is a personal loan to purchase an automobile.
2. It is based on the borrowers integrity and ability to pay.
3. It is an unsecured type of loan.
4. The car itself is used to secure the loan.
5. Here the rate of interest depends upon two factors -
   1. Length of the car loan
   2. Credit rating of the buyer
6. New car loans usually range from 3 to 7 years.
7. Used car loans are offered for shorter durations.

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