Thread Rating:
  • 3 Vote(s) - 5 Average
  • 1
  • 2
  • 3
  • 4
  • 5
Can a Personal Loan be used as a Down Payment?
#21
Hello. Yeah I don’t think that would work. I can understand why they have that rule but different companies have different rules I guess. I suppose they require this because they need proof which I guess is understandable. Sorry if it dint work out hope you figure it out. Have a good day!
Reply
#22
It depends, based upon what I have heard. I know you are talking about a loan, but I'm going to throw a few options in here in case you are still comparing sources and benefits of different type of debt financing.

If you are able to make digital payments, in cases where you're ordering or managing payments online (e.g. for a property and to a property management company in a rent-to-own or other rental manner; or if you're buying a car online such as through DriveTime), you would be able to use a credit card directly. Otherwise, depending upon the creditor and how your line of credit is set up, you would need to do some type withdrawal or request a cash advance. 

As for a personal loan, you should have access to the cash pretty readily, especially if it's a personal or peer-to-peer loan where the funds are deposited or wired directly to you. Cash is cash and I don't believe that most people care where it came from as long as you pay.
Reply
#23
I think it's impossible, I don't see any possible way that the auto lender will know that the money you used for down payment came from a loan. That if the auto lender has a spy network that he used to spy people.
Reply
#24
We'll I think yes, because here in my town almost all of have loans to pay for their house or any other things.
Reply
#25
A down payment is a show of good faith to the lender. Using a personal loan as a down payment most likely will not be accepted. Lenders typically like to see how much free cash you have. Free cash would be money that has not been borrowed or commitment attached to it. I am sure as most people have experienced, the higher amount of free cash you have, the better. When a borrower offers a personal loan it shows they are taking on an additional debt.

Usually, the only acception for one to use a personal loan as a down payment is with a mortgage. Most lenders require a small percentage of the property value as a down payment. However most do not have 5% of a $350,000 house for example. A lender will most likely accept an additional loan as long as your credit history is positive.
Reply
#26
For sure you can use a loan as a downpayment. No one knows where the money originally came from. The important thing is to remember to take into consideration the payments that still need to be paid on a monthly basis and making ends meet. I have known people to borrow a deposit and then get a mortgage with that borrowed money.
Reply
#27
I think they would know because they would ask for the source of the money. If you have been saving or it has come from your salary, your account would reflect this. I'm sure they ask for your bank statements, which would show a personal loan, which would have been advanced to you based on your ability to repay it, which would be reflected in your current account. I guess you can hide it if you have multiple accounts. I would also not advise taking a personal loan to pay for a down payment, that is the begging of disaster!
Reply
#28
(01-01-2018, 04:32 AM)Camilla Wrote:
(12-26-2017, 11:13 PM)Michael Puttman Wrote: According to this article https://www.autocreditexpress.com/blog/c...n-payment/ you can’t use a personal loan as a down payment. How would the auto lender even know that your down payment came from a personal loan?

Yeah, how would the auto lender know that?  Big Grin I can take out a loan a few months before applying for an auto loan and though that may appear in my credit history, how can anyone assume that it was meant to be used as downpayment for a car? Would the auto lender decline my application if my credit scores and sources of income clearly show that I am well capable of paying off the auto loan? I don't think so. The blog post was obviously made to sell the services of an auto loan assistance company which is trying to position itself as an authority. It can work against them, though. The article can raise more questions and put their credibility as service provider at risk.
I can completely agree with you Camilla. First of all how would the car place know except run your credit? Also from that they make an assumption that they are taking that loan and using it as a down payment? How can you just assume that someone got a loan and what they are using it for. I think this article is to get people interested in getting a loan instead of not. I think it is a way of drawing someone in. I think this is a terrible way to advertise if that is what they are trying to do.
Reply
#29
I guess it depends from bank to bank as I have never heard of it. Banks or lending company would like to check your income sources and statements, how punctual you were during your previous loan period. They don't care if the DP is paid from a person loan or saving, but they do hesitate issuing another loan when you already have one.
Reply
#30
I think it's feasible to pay down payment using a personal loan. It's your money, you can do whatever you like with your money. I think they will not know if you pay for down payment using your personal loan. You're the one who will for that money not them, so I think it's okay to use your personal loan as a down payment, and I think they don't care where your money came from as long as you pay.
Reply


Forum Jump:


Users browsing this thread: 1 Guest(s)