At a glance: Lease or buy?

Shopping for a new car? Maybe your current ride has some wear and tear, or you’re interested in switching to a car with better gas mileage. If you’re wondering whether your best move is to lease or buy a car, it’s worth considering both options.

If you’re looking for the most cost-effective option over the long term, buying a used car and keeping it for a few years after you’ve paid it off is often the best choice. But what if you like having the newest technology or the most-up-to-date safety features? Leasing might give you the freedom to make the periodic upgrades you’re looking for without breaking the bank.

Lease or buy: 3 factors to consider

Monthly payment

If your main goal is to get the lowest monthly payments, leasing could be your best option. Monthly lease payments are typically lower than auto loan payments, because they’re based on a car’s depreciation during the period you’re driving it, instead of its purchase price.

Overall costs

Car down payment

Thinking about financing your next car? Your required down payment could be around 10% to 20% of the car’s total cost.

Leasing may also require significant upfront costs, including the first month’s payment and a down payment — especially if you’re interested in negotiating the lowest possible monthly payment.

Auto repairs

The cost of repairs can hit both car buyers and lessees. Cars are typically leased for three years, so if you lease a brand-new vehicle it will likely be under warranty for the duration of your lease. But you may still have to pay for maintenance and repairs, and you might even be required to replace worn tires, scratched windows or other blemishes when you return the car.

As cars get older, the cost of repairs can rise significantly. If you decide to buy, you’ll want to budget for regular maintenance and upkeep.

Depreciation

If you’re a car owner, the more miles you drive, the faster your vehicle depreciates. But putting lots of miles on your car can be an even bigger problem if you want to lease. Auto leases usually come with mileage limits, typically set around 12,000 miles per year for a standard lease. Going over that number could mean being penalized at a rate of about 15 cents a mile.

Leasing fees

Here are some of the other unique fees you may have to pay if you choose to lease a car.

• Acquisition fee — This covers the leasing company’s administrative costs for arranging the lease.
• Security deposit — This might be roughly equal to one month’s lease payment.
• Early termination fee — You might be charged this fee if you end the lease contract early.
• Disposition fee — This covers the leasing company’s costs for cleaning and selling the car at the end of the lease.

Flexibility

For many drivers, the idea of being locked into one specific car over a long time period is … less than ideal. If that sounds like you, leasing might be your best bet.

But leases may not be as flexible as you think. If you get tired of your car or your needs change, you may want to think twice about turning the car in before the end of your lease. If you break your lease early, you could be on the hook to pay some steep penalties. You could even be required to cover all of the remaining lease payments and pay additional penalties on top of any other fees. Ouch.

What’s next?

As with any major financial decision, it’s important to do your homework before deciding to lease or buy a car. Ultimately, the best choice for you depends on your preferences, your budget and your ability to handle the expenses you might incur down the road.

If you’re a soldier or member of a military family and are facing a financial emergency, you may qualify for a loan through Army Emergency Relief.

Army Emergency Relief is a nonprofit organization that offers emergency loans to active duty soldiers, retired soldiers and military family members. There’s no limit for the amount you can borrow, and people who are eligible may qualify for a no-interest, no-fee loan, grant or scholarship.

Let’s review what you need to know about an AER loan, how to apply and other emergency financing options to consider.

• How does an AER loan work?
• How do you pay back AER loans?
• What are my options if I don’t qualify for an AER loan?

How does an AER loan work?

AER doesn’t receive direct funding from the government. Instead, it almost exclusively uses donations to make emergency loans to soldiers and their families. The no-interest, no-fee loans can be used to cover a variety of needs, including rent or mortgage, car payments, household bills, emergency travel, medical bills and even funeral expenses.

There’s no limit on the amount you can borrow. And if you qualify for a loan through AER, you may receive your loan funds within 48 hours of your request.

How to apply for an AER loan

To apply, visit the AER Section on a U.S. Army installation or at the Military Aid Society Office at the nearest Air Force, Navy, Marine Corps or Coast Guard location. Use the office locator on the organization’s website if you’re not sure which location is closest to you.

To complete an application, you’ll need to present a caseworker with your Military ID and documentation of your financial situation. That may include bills, income statements and budget information.

If you’re located more than 50 miles from one of the listed locations, you can apply by contacting the American Red Cross.

How do you pay back AER loans?

AER offers several methods for loan repayment, but it doesn’t accept cash, debit, credit card or payments over the phone. You can choose from one of the following payment options:

• Allotment: Also known as an automatic deduction from your paycheck.
• Online payments: These can be withdrawn from your checking or savings account. You’ll have to register on the AER website before setting up your online payment.
• Check or money order: These can be mailed to AER. Make sure to include your name and client ID along with your payment.

What are my options if I don’t qualify for an AER loan?

The loans issued by AER can cover a variety of emergency-related needs. But certain uses like debt consolidation and legal expenses don’t qualify.

Members of other military branches may qualify for interest-free loans from organizations similar to AER, such as the Navy-Marine Corps Relief Society or the Air Force Aid Society. Just beware of lenders that offer high-interest loans. But thanks to the Military Lending Act, lenders typically can’t charge active military service members or their eligible family members more than 36% Military Annual Percentage Rate, or MAPR.

If you need to look elsewhere for a loan, consider the interest rates and fees as you shop around. Here are some alternatives to consider if an AER loan doesn’t make sense for your situation.

Personal loans

A personal loan may be an option for you to borrow the money you need upfront and pay it back over a set period of time. If you need financing for debt consolidation or another use unapproved by AER, a personal loan may make sense for you.

Some lenders that offer personal loans might consider your military affiliation to qualify you for a lower interest rate, too.

Personal loans can be unsecured or secured. Secured loans mean you use your property as collateral. Secured loans often have lower interest rates than unsecured loans but can be riskier since you may lose your collateral if you fail to make payments.

Payday alternative loans

Payday alternative loans, or PALs, are an alternative to small-dollar, high-cost payday loans. PALs are available through certain federal credit unions if you’ve been a member for at least one month.

These loans can range up to $2,000, with a maximum repayment term of 12 months and a maximum APR that’s much lower than the typical payday loan.

Balance transfer credit card

If you’re looking for a way to make your credit card payments more manageable, you might want to consider applying for a new balance transfer credit card that’s offering a lower or introductory interest rate.

But pay attention to the balance transfer fee. Many credit cards charge a 3% to 5% fee when you transfer debt onto the account.

What’s next?

If you’re in an emergency and need cash fast, you may be tempted to overlook the details of a loan offer, like a three-digit interest rate or untenable monthly payments. But if you’re a service member, an AER loan may help you avoid financial strain.

Whether or not you’re eligible for an AER loan, make sure you clearly understand the terms of any loan you’re offered. Review the interest rate, fees, payment due dates and payment amount before applying for any loan.

Hear from our editors: The 6 best American Express cards of April 2024

Updated April 26, 2024

This date may not reflect recent changes in individual terms.

Editorial Note: Intuit Credit Karma receives compensation from third-party advertisers, but that doesn’t affect our editors’ opinions. Our third-party advertisers don’t review, approve or endorse our editorial content. Information about financial products not offered on Credit Karma is collected independently. Our content is accurate to the best of our knowledge when posted.

Written by: Tim Devaney

American Express offers a variety of credit cards with competitive bonus offers and other rewards. Save yourself some time on comparison shopping by checking out our favorite American Express credit cards for travel, restaurants, business cash back rewards and more.

• Best for travel: Platinum Card® from American Express
• Best for restaurants: American Express® Gold Card
• Best for groceries: Blue Cash Preferred® Card from American Express
• Best for no annual fee: Blue Cash Everyday® Card from American Express
• Best for small businesses: The American Express Blue Business Cash™ Card
• Best for business travel: The Business Platinum Card® from American Express

Best for travel: Platinum Card® from American Express

Here’s why: The Platinum Card® from American Express offers so many travel, dining and lifestyle perks that you might just be able to justify paying the high annual fee.

Read reviews of the Platinum Card® from American Express for more details.

Best for restaurants: American Express® Gold Card

Here’s why: If you enjoy eating out, the American Express® Gold Card offers enough dining credits and restaurant rewards to help offset the annual fee.

Read about the American Express® Gold Card to learn more.

Best for groceries: Blue Cash Preferred® Card from American Express

Here’s why: If you enjoy cooking at home, the Blue Cash Preferred® Card from American Express features a terrific cash back rate on groceries and other household expenses. But it only makes sense for people who spend enough at U.S. supermarkets to justify the annual fee.

Check out reviews of the Blue Cash Preferred® Card from American Express for more details.

Best for no annual fee: Blue Cash Everyday® Card from American Express

Here’s why: For anyone on a budget, the Blue Cash Everyday® Card from American Express’ competitive rewards and perks — combined with no annual fee — make it a good option.

Find out more in reviews of the Blue Cash Everyday® Card from American Express.

Best for small businesses: The American Express Blue Business Cash™ Card

Here’s why: The American Express Blue Business Cash™ Card frees you up to focus on running your business, instead of worrying about which card to use to get the most cash back. And with no annual fee, it’s the obvious choice for small-business owners who want to cut expenses.

See why in reviews of The American Express Blue Business Cash™ Card.

Best for business travel: The Business Platinum Card® from American Express

Here’s why: If you travel often for work, investing in The Business Platinum Card® from American Express could pay off in the long run. Though it charges an expensive annual fee, the luxury benefits will make your business trips more comfortable, while the rewards could help you pay for that much-needed vacation.

Take a look at reviews of The Business Platinum Card® from American Express to learn more.

How we picked these cards

To choose the best card for each category, we took a comprehensive look at all the credit cards offered by American Express, identified common rewards categories and determined which one presented the largest or most valuable reward. Where there wasn’t a clear winner, we considered the following:

• The value of additional perks
• Fee structures
• Complexity of rewards categories and restrictions

We excluded co-branded cards, or cards that primarily offer points and rewards for purchases made through specific vendors.

How to make the most of these cards

If you’re preparing to apply for a new American Express card, be sure to review all fees and restrictions to see if the card matches your spending habits and needs.

For instance, luxury cards often come with hefty annual fees, and you can only make up for them if you’re proactive about using perks like airline fee credits or lounge access. As with any credit card application, be sure to do some homework first. If you understand the fees and restrictions upfront, you’ll be better equipped to get the most out of whichever credit card you choose.

FAQs about American Express cards

A mutual fund is a company that allows a pool of people to invest by buying shares in the fund. The company uses that pooled money to invest in a variety of stocks, bonds and other securities. By doing this, the mutual fund allows its customers to build diverse investment portfolios without having to buy their own individual stocks or bonds. This approach can cost less than you might pay to buy a variety of securities on your own.

If you’ve built up an emergency fund and are doing well managing debt, you might feel ready to begin investing. A mutual fund can be a good place to start if you want to save money for retirement or other goals.

Let’s look at how mutual funds work and how they can help you progress toward your savings and investing goals.

• How do mutual funds work?
• What makes mutual funds different from other types of investments?
• What are some types of mutual funds?
• What are the pros and cons of investing in mutual funds?
• How do I start investing in mutual funds?

How do mutual funds work?

Mutual funds are managed by companies that must register with the Securities and Exchange Commission, or SEC. When you invest in a mutual fund, you purchase shares in the fund, either from the fund itself or through a broker or other investment professional. Each share represents your percentage of ownership of all the investments in the mutual fund’s portfolio.

Your investment in a mutual fund can make you money in a few ways.

If the fund sells securities during the year and makes a profit (called a capital gain) off that sale, it might distribute those gains (minus capital losses) to shareholders at the end of the year. Or the securities in the fund’s portfolio might pay dividends, which are distributed to investors.

Finally, if the market value of the mutual fund’s portfolio increases, your shares’ value could also increase — although that money would be “on paper,” rather than in your pocket, unless you sold your shares at the higher price.

When your shares make you money, you’ll usually have the option of asking for a check (or other type of payment) or reinvesting your payoff to buy more shares in the fund.

Mutual funds can allow investors to diversify their investments more easily and cheaply than if they tried to do so on their own. And diversifying your investments can mean less risk of loss than you might have if you put all your money in just one or two investments.

What makes mutual funds different from other types of investments?

Mutual funds have several features that set them apart from other types of investments.

Mutual fund share classes

Some mutual funds allow investors to tailor their experiences by choosing among different classes of shares. Each share class has its own fees, services and expenses, and each one performs differently. But be aware that your broker or adviser will likely be paid different fees for each class of shares they sell.

Professional management

Mutual funds are typically managed by professional investment advisers who choose what products the fund will invest in. Funds can be either actively or passively managed.

Advisers of actively managed funds may buy or sell fund investments every day in an effort to maximize the fund’s performance. But there’s no guarantee they’ll succeed, and actively managed funds tend to have higher management fees since you’re basically paying for the skill and expertise of the fund manager.

You can also choose a “passively managed” fund, or index fund, which doesn’t try to beat the market to provide higher returns in the short term. Management fees are typically lower for passively managed funds.

What are some types of mutual funds?

There are multiple types of mutual funds, and they’re generally classified based on the types of securities they invest in. Here are some (but not all) types of mutual funds to consider.

Stock funds

• Invest primarily in stocks (also known as equities)
• Fluctuating stock prices can make performance rise and fall
• May perform better over the long term since stocks historically perform better over time than other types of investments

Bond funds

• Higher risk/return than money market funds
• Invest primarily in various types of bond purchases

Money market funds

• Relatively low-risk funds
• Invest primarily in safer, short-term investments like U.S.-based corporations and government entities

Balanced funds

• Also known as asset allocation funds
• A mostly fixed combination of stock funds, bond funds and money market funds

Target date funds

• Also known as lifecycle funds
• Created with a set end or retirement date
• A mix of stocks, bonds and other securities that changes over time

What are the pros and cons of investing in mutual funds?

Like any type of investment, mutual funds have advantages and disadvantages. If you’re thinking about investing in mutual funds, assess for your own situation whether the value of the advantages outweighs the potential disadvantages.

Pros of investing in mutual funds

• More opportunity for growth — Deposit accounts like savings, checking and certificates of deposit are generally considered safe. But interest rates on these investments tend to be low. People may put money into investments like mutual funds in the hopes of getting a higher rate of return on their money.
• Low startup costs — Some mutual funds set low minimums for the amount you’re required to purchase, which gives you the opportunity to start investing without a lot of cash. And some may also have low prices to purchase additional monthly shares.
• Professional management — Investing can be confusing, and you might welcome some professional help. If you invest in an actively managed fund, a professional manager should research investment vehicles and make informed decisions about which ones to invest in and monitor how well the fund is doing over time.
• Liquidity — Some types of investments limit when you can access your money. But when you invest in a mutual fund, you can redeem your shares on any business day. Mutual funds must then send payment for the shares within seven days.

Cons of investing in mutual funds

• Fees — Mutual funds allow you to sell your shares whenever you want, and redeem the net asset value, or NAV, for your shares. But that net value is what you get after paying fees. Mutual funds can charge investors sales charges, annual fees, management fees and other costs — and you’ll pay them even if your mutual fund investment loses money.
• Capital gains tax — If you receive a capital gains distribution from your mutual fund, that money could be subject to capital gains tax.
• Not backed by the FDIC — Unlike some other investment tools, mutual funds aren’t FDIC insured, which means you could potentially lose some or all of the money you invest if your fund performs poorly.
• Less control over investments — The fund company decides where to put your (and your fellow shareholders’) money. You may want a say in where your money gets invested for a number of reasons. For example, you may be concerned about the environmental or social impact of your investments. If so, consider looking for a mutual fund that practices sustainable, responsible and impact investing, or SRI.

Common question: What is the capital gains tax rate?

How do I start investing in mutual funds?

If you have an employer-sponsored retirement account, like a 401(k), chances are you’re already invested in a mutual fund. If you’re ready to open an additional account on your own, here are a few steps to consider before you begin investing.

Start by looking at how much risk you can afford to take when you invest. You can determine your “risk tolerance” on your own or with the help of an investment professional, based on variables like your current age, retirement age and whether you’re on a fixed income.

While you want to know how well a mutual fund you’re considering has performed in the past, keep in mind that past performance isn’t necessarily the best way to predict how the fund will perform in the future. Weigh the fund’s past performance along with other factors like how long the fund has been in business and the size of the fund.

Research any representative you’re considering working with to see if they’re licensed and registered, or if they have any negative records. You can look this info up through the Securities and Exchange Commission at investor.gov.

Finally, take extra care to review all of the fees a mutual fund charges. A difference in costs between funds may seem small, but those costs can add up over time. You can find information about fees, risks and more in a mutual fund’s prospectus.

Bottom line

When investing, the general rule of thumb is that higher returns often equal greater risk. Diversifying your investments can be one way to help mitigate risk, and mutual funds can help you diversify easily and cost-effectively.

Remember that investing often takes time to pay off. Pay down debt, build up an emergency fund and maximize your contributions to your 401(k) (if you have one) before delving into the world of investing.

If you own a Series EE or Series I savings bond, you have a few different ways to cash it in, but you’ll need to gather some information first.

A U.S. savings bond is a low-risk investment product that’s backed by the U.S. government and purchased through the U.S. Department of Treasury. Today, you can buy two types of savings bonds: Series EE and Series I bonds. Both earn interest over time, up to their date of maturity — 30 years.

You have to wait at least 12 months from the date of purchase to cash in a savings bond (there’s one exception, which is if you’re affected by a natural disaster). And if you cash it in at any time from one to five years, there’s a penalty: You’ll lose the three prior months’ worth of interest. If you hold onto the bond past five years, there’s no penalty when cashing in.

It’s easy to cash in a savings bond, but it’s important to understand the type of bond you own and the value of holding onto it before you cash yours in. Let’s take a look at how to cash in Series EE or Series I savings bonds.

• How does a savings bond work?
• When should you cash in a savings bond?
• Can you cash in a savings bond at a bank?

How does a savings bond work?

Savings bonds have been around since 1935, as a result of legislation passed by President Franklin D. Roosevelt. Bonds were created to help Americans save money and to give the government funds to support efforts such as World War II. When you buy a U.S. savings bond, you’re essentially lending money to the United States government through the Department of Treasury.

The types of savings bonds available for purchase have changed over the years. For example, Series HH savings bonds are no longer sold. Here’s the rundown on Series EE and Series I bonds, the two types of savings bonds sold today.

Series EE bonds

Series EE savings bonds earn a fixed rate of interest each month for up to 30 years. The rate for new bonds is announced by the Treasury each year on May 1 and November 1. EE bonds purchased before May 2005 have variable interest rates. This type of bond is available in an electronic form and can be purchased in penny increments starting at $25 and up to a maximum of $10,000 per calendar year.

Series I bonds

Series I savings bonds earn a fixed rate of interest that’s adjusted for inflation twice a year. Like Series EE bonds, electronic Series I bonds are available in penny increments of $25 to $10,000 per calendar year. Paper Series I bonds (available for purchase only when filing a federal income tax return) are available in amounts of $50, $100, $200, $500 and $1,000 only.

How much are savings bonds worth?

Savings bonds earn interest for 30 years, but rates are relatively low. In May 2020, the U.S. Department of Treasury declared a 0.10% rate for Series EE savings bonds and a composite, or combined, 1.06% interest rate for Series I bonds through Oct. 31, 2020. These rates are comparable to the interest you can earn on some savings accounts but lower than that of some certificates of deposit and money market accounts.

Interest earned on savings bonds is exempt from state and local taxes, and federal income tax is deferred until you cash in your bond or it matures — whichever happens first. If you plan to use savings bonds to pay for qualified education expenses, you may get additional federal tax benefits.

When should you cash in a savings bond?

You can cash in a savings bond once you’ve owned it for a minimum of one year. But if you want to avoid penalties, you’ll need to wait five years. Otherwise, you’ll lose the last three months of interest earned.

The longer you wait to cash in your savings bond, the more your money will grow. Savings bonds continue to grow in value until they reach maturity at 30 years. If your savings bond hasn’t reached its maturity date, you might want to avoid cashing it in unless you plan to invest the money in an account that earns higher interest.

If you want to know how your bond is growing, you can see the current value of your electronic savings bond by logging into TreasuryDirect. For paper bonds, use the U.S. Treasury’s online savings bond calculator.

Can you cash in a savings bond at a bank?

Where you can cash in depends on whether you have a paper or electronic savings bond.

Paper bonds

Paper savings bonds can typically be cashed in at your bank or credit union. If you plan to visit a financial institution where you’re not a member or customer, you may want to see if it will cash your bond before you visit.

Check with the bank to confirm what documents you’ll need to bring. In general, here’s what you should take with you.

• Your paper savings bond
• Identification, such as driver’s license
• If you’re the beneficiary, a copy of the owner’s death certificate

Keep in mind that bonds can’t be cashed in by just anyone. Savings bonds must be cashed in by the bond owner or co-owner, which includes “survivors,” or people named on the bond who inherited ownership after the original owner passed away. If you bought the savings bond through an auction site like eBay, you are not the registered owner (a savings bond is nontransferable) and can’t cash in the bond.

A parent may cash in a child’s savings bond if the child is too young to sign the request for payment and the child lives with the parent — or the parent has legal custody of the child.

Anyone else who wishes to cash in a bond needs to present evidence of the legal right to do so.

At the bank, you’ll sign each bond and receive the cash value. Once you’ve cashed in your bond, the bank will either hand you a 1099 tax form or mail it to you by the end of the tax year.

Paper bonds can also be cashed via mail. To cash in by mail you’ll need to download or order a FS Form 1522 from the U.S. Department of Treasury, get your signature certified and mail the form to the address noted on the form.

Electronic bonds

Electronic bonds can be cashed in by logging into your TreasuryDirect account and setting up a direct deposit to your checking or savings account. The cash amount may be credited to your bank account within two business days.

What’s next?

Cashing in a savings bond can provide fast access to cash when you need it. But if the bond is only a few years old, cashing it in could mean losing interest earnings, along with future growth.

If your bond has reached maturity but you don’t need the cash from it for now, cashing it out and putting the money into a high-yield savings account, money market account or CD could help you continue to earn interest.

Pros

• Perfect credit not required
• Get cash for referrals
• No prepayment penalty

Cons

• Only available in 12 states
• Maximum loan amount varies by state
• Interest rates not available upfront, but max rates allowed are high

What you need to know about an AmeriCash personal loan

AmeriCash got its start in 1997 as a cash advance loan company. Ten years later, the lender changed course and now offers installment loans ranging from $50 to $4,000, depending on the state. Borrowers in 12 states can apply for a loan online or in person and can typically get funding within one day if approved. But take note that loan amounts and terms vary by state, so be sure to check the loan information for your state before you apply.

While AmeriCash is no longer a cash advance or payday lender, the short-term installment loans it offers can still be risky. That’s because the lender can charge interest rates in the triple-digits — much more than more-traditional loans from a bank or credit union.

AmeriCash doesn’t disclose its interest rates and fees upfront — though it does list maximum rates allowed by the some of the states it offers loans in.  And it’s good to know that some borrowers report being shocked when they discovered the actual cost of repayment.

When it comes to finding the right loan for you, knowing the cost of borrowing upfront, and whether you can afford to repay the loan, is very important. Consider this when deciding if AmeriCash is the right lender for you.

Here are some other things to know about AmeriCash loans.

Interest rates may be high

AmeriCash doesn’t advertise its interest rates online, which makes comparing it with other lenders tough.

Current and past borrowers have reported loans that come with fees that can equate to APRs in the triple digits, which isn’t uncommon for payday loans. In fact, the average APR on traditional payday loans is 391%, according to the Responsible Lending Organization.

Preapproval available

Even though it doesn’t show its rates upfront, AmeriCash does offer loan preapproval, which lets you see an estimate of your loan terms and interest rate before you decide to formally apply for a loan.

Just keep in mind that preapproval doesn’t mean you’ve been actually approved for a loan. And any loan rates and terms you’re preapproved for may not match any loan you ultimately qualify for. But preapproval can help you estimate your loan cost and shop around for the best deal for your situation.

Funding within one business day

AmeriCash offers loans as small as $50, depending on your state, and if you’re approved, you can typically get the money within one day. And if you apply online, you can choose to have your approved loan deposited directly into your bank account or pick up a check at a physical location.

If you apply at a physical location and are approved, the lender says you can get your loan funds immediately.

Great credit not required

AmeriCash caters to people with bad credit and those who’ve been previously denied by other lenders, though the lender isn’t clear about its credit score requirements.

A closer look at AmeriCash personal loans

Here are some other important points to consider before applying for an AmeriCash loan.

• Even if you’re applying online, AmeriCash loans are available only for residents of the following states: Arkansas, Florida, Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Oklahoma, South Carolina and Wisconsin.
• The maximum loan amount varies by state. For example, in Oklahoma the largest loan available is $1,470, but you can borrow up to $4,000 if you live in Illinois, Indiana or Michigan.
• The lender’s Refer-a-Friend program awards you up to $100 for every person you refer who’s approved for a loan. The applicant you refer will also be awarded a credit of up to $50 toward their new loan.

Who an AmeriCash personal loan is good for

Short-term installment loans from AmeriCash are designed for people in a financial pinch. If your credit isn’t in great condition and you need a small-dollar loan quickly, AmeriCash may be able to help.

But like most lenders who offer emergency loans, AmeriCash is still likely to hit you with exorbitant rates and fees.

In order to avoid a never-ending cycle of debt, make sure to apply for preapproval and review your estimated terms. And you should examine all legal disclosures before formally applying for a loan.

If you decide that an AmeriCash loan isn’t right for your situation, asking a friend or family member for the money — or taking some time to save up the cash — could be a much cheaper and more stress-free option in the long run.

How to apply with AmeriCash

First, check the AmeriCash website to verify that it offers loans in your state. If there’s a physical location near you, you can apply in person. You can also apply online.

Here’s what AmeriCash says you may need in order to complete your application.

• Bank account and voided check
• Driver’s license or state-issued ID
• Current proof of income
• Two documents to prove residency

If you’re applying online but you live near a location, you can choose the “check” option in your application if you’d rather pick up a check instead of receiving your loan via direct deposit.

Not sure if AmeriCash is right for you? Consider these alternatives.

Do you have less-than-stellar credit but need a small loan in a hurry? Consider these lenders before choosing a loan.

• Avant: Avant offers loans ranging from $2,000 to $35,000 and considers borrowers with fair-to-poor credit.
• Fig Loans: Its credit-builder loans are an alternative to payday loans for borrowers with bad credit.
• Oportun: No credit is needed to be considered for an Oportun loan.

If you want to experience the thrill of the open road but don’t want to pay for a brand-new bike, financing a used motorcycle might make a lot of sense.

First, you’ll need to set a budget and decide how much you’re willing to pay before you go shopping. You’ll also need to decide if you want to buy a bike that you can pay for in cash or if you need to get a used-motorcycle loan.

Don’t take out a loan without doing your research first. Start by comparing different motorcycles and loan options. Here’s what you should know before putting your money and credit on the line.

• Where to shop for a used motorcycle
• Where to shop for a used-motorcycle loan
• Should I get a used-motorcycle loan?
• Tips for buying a used motorcycle

Where to shop for a used motorcycle

Whether you’re unsure what kind of motorcycle you want or you’ve got your heart set on a certain bike, comparison shopping can help you get the best deal. Here are a few places to shop.

Dealerships

When you start your motorcycle search, it’s easy to gravitate to motorcycle dealers. You may be able to browse a variety of pre-owned bikes with them — sometimes you can even search online from the comfort of your couch.

Some dealerships will even let you schedule test drives through their websites. Searching online inventories can help you compare a wide number of bikes and prices, without the pressure and time investment of speaking to a salesperson. You may even be able to apply online to see if you prequalify for a loan — but until you complete a formal application, you won’t be guaranteed approval or specific loan terms.

Buying from a dealership may mean getting a bike that’s in better condition than one you’d find somewhere else. Unlike private sellers, dealerships have to worry about their reputations. So they may be more likely to buy and sell well-maintained motorcycles and provide upfront disclosures about the history and condition of their bikes.

Private sellers

If you don’t want to go through the dealer, you could also try to buy from an individual, or private party. Private sellers probably have more intimate knowledge of the history of their bikes and may be willing to help you understand the finer points of operation.

Of course, it’s not safe to assume a seller will tell you everything. The U.S. Department of Justice strongly recommends that you get a vehicle history report before making your purchase.

Check the motorcycle’s vehicle identification number to see if it’s been stolen or has other issues like an unresolved recall. You can usually locate the VIN on the bike’s frame near the handlebars or by the engine block or cylinders.

Like dealerships, many private sellers list their motorcycles online. Some popular websites for private sellers include Autotrader, Craigslist, Cycle Trader and eBay.

The Motorcycle Industry Council recommends completing these steps before finalizing a private party purchase.

• Verify you’re covered by insurance
• Confirm that the seller has a current title and registration
• Check service records
• Get an owner’s manual
• Ask for any spare keys or parts

Where to shop for a used-motorcycle loan

Not all lenders offer financing for motorcycles, even if they finance other vehicles. But that doesn’t mean you’ll be short on options. Shopping for loan offers through multiple lenders can help you find the best deal for you. Here are a few places to shop for a used-motorcycle loan.

Banks and credit unions

Even if you’re buying your motorcycle from a dealership, you can get financing separately through a bank or credit union — and it might mean getting a better deal for your situation.

Going through a bank or credit union may allow you to get preapproved for a certain loan amount and terms. Unlike dealer financing, you can use your preapproval offer to shop around  to find the best used bike your offer covers. Note that you need to complete a full application with the bank or credit union before you’re formally approved for a loan, and you may be offered different terms than what you were preapproved for.

While borrowing from a bank or credit union can save you money, it can also take more time. If you opt for dealer financing instead, you’ll be applying for a loan and buying your bike in one place.

On top of that, each bank and credit union has its own process for declining or approving motorcycle loans.

Other lenders allow you to apply for a used-motorcycle loan directly through their websites. But forget getting approved for the best rates — you may not even be able to apply at all if you’re not already a member of the credit union.

Online lenders

Online lenders offer loans for used motorcycles without you having to visit a bank branch or become a credit union member.

You can use comparison sites to shop potential terms for used-motorcycle loans before you apply.

Try not to rush the process. Borrowing online can be attractive because of the convenience, but you’ll still need to put in time to read and compare offers. Be sure to review the fine print for unexpected fees and costs, like penalties for paying off your loan early or fluctuating interest rates.

Dealers

Dealer financing allows you to take care of both your financing and your purchase in one place. With this option, you can apply for your loan directly through the dealer.

But that convenience may come at a price. Dealer financing can be more expensive and can deter you from comparison shopping.

For instance, a loan through Yamaha may be available only for certain Yamaha models.

If you want to avoid visiting multiple locations, but you still want to go through a dealer for your financing, consider applying online or by phone. Many dealers now offer the option to apply for financing before visiting their showrooms.

Should I get a used-motorcycle loan?

Buying a used motorcycle with cash can help you avoid finance charges and other hassles, but if you aren’t in a position to buy a motorcycle outright, consider this information first.

Pros of a used-motorcycle loan

• Used vehicles depreciate more slowly than new vehicles. Financing a used motorcycle can be a smart move. New vehicles depreciate, or lose value, rapidly in their first few years. This can leave an owner owing more on a loan than a vehicle is worth.
• Motorcycles retain value. Motorcycles may be a good bet for financing since they don’t necessarily lose value as quickly as cars. A well-kept or rare motorcycle may even retain value or increase in value over time.
• Taking out a loan will help you get access to transportation. Taking out a loan can be a good option when you need to secure transportation and don’t have the luxury of waiting to save money. Financing will allow you to buy a bike now and repay what you borrowed over time.
• Build your credit. Like an auto loan, repaying a used-motorcycle loan can also help you build your credit. As long as you make your payments as scheduled, your used-motorcycle loan can help you build a positive payment history and a fuller credit profile, both of which can help boost your credit health.

Cons of a used-motorcycle loan

• A loan can be expensive. Borrowing money usually means paying interest and fees to your lender, making it more costly than if you had purchased your bike with cash.
• Used-motorcycle loans will come with higher interest rates than new-motorcycle loans. Used-motorcycle loans usually have higher annual percentage rates, or APRs, than loans for new bikes. Your APR will include the interest rate and any fees.
• Risk of default: High interest rates make it more costly to borrow money. High rates usually mean higher monthly payments, and potentially more difficulty repaying your loan. Missing a loan payment could mean damaging your credit.

Tips for buying a used motorcycle

Before you buy your next bike, make sure you take some time to prepare. Following these tips can help you find and finance a bike you’ll be happy with in the long term.

• Check your credit: Making improvements to your credit could help you qualify for better loan terms.
• Calculate affordability: Examine your budget to see how much you can realistically pay toward a loan each month. Consider motorcycle insurance, registration and ongoing maintenance costs, too.
• Research prices: Explore the market to be sure you’re getting the best price available for the bike you want.
• Go for test drives: Test drive multiple makes and models and be sure to drive a bike in various road conditions before buying.
• Negotiate: You can negotiate both loan terms and purchase price to get the best deal upfront and make loan repayment more affordable.
• Take it to a mechanic: Get your own inspection, regardless of seller guarantees.
• Get maintenance and accident records: Even if you have to pay for its records, it’s better to understand a motorcycle’s history upfront.

Updated October 21, 2021

This date may not reflect recent changes in individual terms.

Editorial Note: Intuit Credit Karma receives compensation from third-party advertisers, but that doesn’t affect our editors’ opinions. Our third-party advertisers don’t review, approve or endorse our editorial content. Information about financial products not offered on Credit Karma is collected independently. Our content is accurate to the best of our knowledge when posted.

Written by: Sarah Brady

Pros

• Loan options include new- and used-car loans, auto-loan refinancing
• APRs starting as low as 1.14% for new cars purchased through PenFed’s car-buying service
• Loan amounts from $500 to $100,000
• Debt protection in case of hardship

Cons

• Membership and opening deposit required
• Excellent credit required for lowest rates
• Late payments subject to a 20% charge

What you need to know about Pentagon Federal auto loans

Pentagon Federal is a military credit union that accepts certain civilians as members. Like many credit unions, it offers special discounts and rebates to members. Catering to military personnel, PenFed offers hardship debt protection to people who qualify and deployment guides for service members who are serving across the country and overseas.

But before you apply for a PenFed auto loan, make sure to understand your loan terms because late fees can be costly. Here’s some key info about PenFed auto loans.

Membership required but civilians welcome

PenFed is a military-based credit union, but certain civilians can join too. If you’re a member of any of the following associations, you may be eligible to join PenFed.

• American Red Cross
• American Society of Military Comptrollers
• Coast Guard Auxiliary Association
• Military Officer’s Association of America
• National War College Alumni Association
• Navy League of the United States
• Marine Corps League
• United States Department of Energy
• United States Army Warrant Officers Association

You can also become a member by donating to an eligible charity.

Attractive rates for people who qualify

For new-car loans, used-car loans and auto-loan refinancing, PenFed advertises some competitive rates. Compare its 2.14% APR offer on new-car loans to the lowest rates advertised by other major lenders — including Bank of America, LightStream, Navy Federal and USAA — and you’ll find that PenFed offers lower starting APRs for eligible borrowers.

Keep in mind, though — if you’re approved, your interest rate may differ from advertised rates based on your credit and other factors, including your desired loan terms. If you don’t have excellent credit, you can expect to pay higher interest.

If you buy a car through the PenFed Car Buying Service, you may qualify for additional discounts and APRs as low as 1.39% on a new-car loan or 2.24% on a used-car loan depending on the loan term.

On top of that, when you buy through a dealer that’s certified by PenFed you can get additional discounts and reimbursements. While the credit union partners with a range of dealerships, it offers special incentives on select models through participating dealerships selling Alfa Romeo, Jeep, Mercedes-Benz and more.

Preapproval options, conditions apply

Getting preapproved for a car loan gives you the chance to review and negotiate your estimated loan terms before accepting a lender’s offer. But not everyone who applies for an auto loan at PenFed will have that option.

You have to be a PenFed member for more than 90 days in order to apply for preapproval — and keep in mind that even if you qualify for preapproval, it’s not a guarantee you’ll be approved for the loan. And if you’re formally approved for a loan, you might be offered different terms than you were preapproved for.

A closer look at PenFed auto loans

Don’t let low rates distract you from reading the fine print. Here are some important details.

• You can borrow up to 110% of the purchase price on certain new and used cars.
• Late loan payments are subject to a charge of 20% of the overdue amount, but with a $25 max.
• PenFed also offers Payment Saver auto loans at slightly higher rates for short payment terms, but these loans come with a final balloon payment.
• PenFed is insured by the National Credit Union Administration, or NCUA, which provides protections similar to those offered by the FDIC to banks.
• Membership isn’t restricted by state, but PenFed has fewer than 50 physical bank branches.

Who a PenFed auto loan is good for

If you’re looking for competitive interest rates, and you’ve got the credit needed to qualify for them, a PenFed auto loan could be an option. This is especially true for anyone looking for 36-month financing, since PenFed offers the lowest rates for loans with three-year repayment terms.

But keep in mind that the shorter the repayment term, the higher the monthly payments. A $25,000 loan repaid over 36 months, even with a 2.49% APR, would result in a monthly payment of $721.42. But you’ll pay less in interest than if you had a longer loan term.

Not sure a payment like that would fit into your budget? You can estimate your monthly payment using PenFed’s Auto Calculator and review your budget to see if you can keep up with the monthly payment required.

Applying for a loan, even if you have a preapproval offer, is a risk. Even if you use a loan calculator, you won’t know exactly what your payments and other loan terms are until you’re approved. If you’re a member and you have access to preapproval, you can make an informed decision about whether or not you should apply for a PenFed auto loan — but preapproval terms may change if you submit a formal application and are approved.

How to apply for a loan from PenFed

Applications can be submitted online, in the mail or through fax, and are accessible to both current and prospective members (with certain requirements).

Here’s an overview of the process.

1. Choose the loan category that fits your needs on PenFed’s Auto Loans page and click the “Apply Now” button.

2. Log in if you’re an existing member or fill out your application to create an account.

3. Enter the required details, including your desired loan amount, contact information and income information. You may also be required to submit photos of your ID.

Not sure if PenFed is right for you? Consider these alternatives.

PenFed members have access to the credit union’s competitive rates and the option to qualify for preapproval. If you’re not a member and don’t plan to become one, consider these alternatives instead.

• LightStream auto loan: Lightstream offers multiple loan options with a possibility to get competitive rates thanks to its “Rate Beat” option.
• Alliant Credit Union auto loan: This credit union gives you the chance to apply for preapproval, so if you’re preapproved you can shop around before you finalize your financing.

But with so many websites and options to choose from, you might need a little guidance.

An online auto dealer or bidding site can expose your vehicle to an audience of buyers far beyond your ZIP code. Whether you’re using an auto trading website, a car-selling app or are posting an ad on an online classifieds website, here are some ways to maximize your chance of getting a good deal and handle the process with ease.

1. Determine your car’s value
2. Decide where to list your car
3. Create your ad
4. Finalize the price and accept an offer

1. Determine your car’s value

Before you create an ad to sell your car online, you’ll need to do a little research. 

Use online tools

Sometimes a seller may overestimate the value of their used car if they don’t understand how it’s depreciated, or if the vehicle has emotional significance for them. But you can objectively assess the fair market value of your car by checking out other listings, sale prices and even getting free estimates.

Websites like Autotrader, Consumer Reports, Edmunds or Kelley Blue Book can be helpful by giving you an estimate of what your car may be worth. Some sites may even make you an offer, based on a handful of questions about your car. Typical appraisals are based on things like your mileage, condition of the vehicle, car color, vehicle identification number, your ZIP code and more.

You can also take your car for an in-person appraisal, even if you plan to sell online eventually. CarMax, for example, can give you an in-person estimate and maybe even an offer. You can hold on to your offer for the period of time it’s valid while you shop around and compare other estimates before listing your car.

Consider a trade-in

It’s still important to research the value of your car upfront to get the best deal possible when you’re trading in your car. Even if you just email a couple of dealers and compare quotes, you may be able to negotiate a better trade price.

If the car you’re trading in isn’t paid off, make sure you understand how the trade will affect any financing for your new vehicle. Some dealers may claim you won’t have to continue paying back your loan, but that’s not necessarily true. If you owe more on your car loan than your car is worth, trading in a vehicle doesn’t relieve you from that debt.

Do a self-assessment

If you’re forgoing a professional inspection or simply unsure how your car really compares to similar vehicles online, take into account some of the main factors that can affect the value of your car.

• New brakes or tires are needed
• The car’s been in an accident
• A recall hasn’t been resolved
• You haven’t kept up with scheduled maintenance
• The car’s had multiple owners 

Spending a little time and money on these repairs can be worth the investment. Professional detailing — or even simple cosmetic fixes to chipped glass, broken headlights or scratched paint — can help you get a better offer.

2. Decide where to list your car

When choosing where to list your car online, be sure to shop around. To get the best price, you may have to be patient or even list in multiple places.

Wherever you decide to sell, consider taking a little time to familiarize yourself with the process first, from posting the ad to finalizing the sale. Keep a checklist to compare all fees, complimentary services, whether your car will be listed through partner websites, how long your ad will be posted and who may see your ad. 

Online dealers

If you prefer listing through an online dealer, there are many car-selling sites that can help you find buyers. Although selling your car through an online marketplace like Autotrader often involves fees, it can also mean getting your ad exposed to a large number of potential buyers in a wide geographic area.

In some cases, online dealers will also take care of the hassles involved with selling. For example, through Shift.com’s online car-selling service, you’re paired with an agent who evaluates your car in person and picks it up when it’s sold. For a fee, Autotrader can offer a VIP option that includes taking photos and screening buyers for you.

Bidding sites

Bidding sites may offer a variety of options for finding buyers and setting your price. If your main goal is to sell quickly, you can post your ad through a bidding service and simply accept the best offer you receive. EBay Motors offers a “Buy It Now” option, which allows a buyer to select a fixed price to immediately purchase.

The downside to bidding services is that buyers may expect a deal since they won’t necessarily have a chance to test drive or even see the car in person. And like other online auto-selling services, you may be charged fees, regardless of whether you sell your car. Be sure you’re familiar with what the fee structure is before you list.

Web ad

If you’re willing to invest more time or you want a more hands-on experience, you can post an ad through a social media or a no-frills classified site. These options may not reach as wide of an audience, but many of these options are free.

Although some sites will allow you to post your ad — and be contacted — anonymously, others will allow you to check out the profile page of your potential buyer. Remember to consider the risks in meeting a buyer from online in person and consider ways of managing that risk. Let’s look at some tips below.

3. Create your ad

A carefully written car ad can help reduce the overall time spent answering questions about your car — and it may even bring in more offers.

According to Autotrader, it should take at least an hour to write a good ad for your car. The site recommends going beyond listing your car’s features to anticipate buyer questions and highlight details that make your car stand out in comparison to others.

A good online ad also includes lots of photos of your car. This gives the buyer a chance to examine the condition, including interior and exterior blemishes. The total number of photos you can post will depend on the site you use.

Before taking your photos, be sure to thoroughly clean the vehicle and park in an attractive, sunlit location. In addition to taking photos of the whole car, be sure to include shots of the following:

• Odometer showing mileage and VIN number
• Engine
• Front and back grills
• Wheels and tires
• Carpets and upholstery
• Any scratches or dents

4. Finalize the price and accept an offer

Now that you’ve created your online ad, you can focus on communicating with buyers and negotiating your sale price.

Screen buyers

Some online services can take away the pressure of negotiating the price with your buyer. The process on some sites may be as simple as accepting an offer from a buyer who may be a dealer, while others may include you naming your price and waiting to see who is interested.

But if you have to manage this part of the process yourself, following a few tips may help you get a better price.

First, practice good communication. Be sure to respond to interested buyers in a timely manner and communicate your expectations clearly. Avoid engaging with people who can’t make the purchase without financing or payments.

Second, be prepared to negotiate. This may mean explaining how you arrived at the asking price, including references to your upkeep and maintenance records. Keep in mind that even if your price is well-reasoned, negotiating might mean accepting less. Decide your minimum price in advance.

Meet in person

Depending on the service you use, you may have to take the extra step of meeting the buyer in person to finalize the deal. Here are some tips for exercising safety when meeting with an unknown buyer.

• Choose a highly visible, public place
• Don’t go alone
• Photograph the buyer’s driver’s license and send a copy to someone you trust
• Accompany the buyer for a test drive if you feel comfortable, and bring along another person with you on the drive

The buyer may ask to have your car inspected by their mechanic, which is a common practice for car buyers. Consider whether you’d feel more comfortable accompanying the buyer on this step.

What kind of payment should you accept? Consider whether you are most comfortable with handling payment in cash or a digital payment tool as opposed to a cashier’s check or money order. The benefit of a cashier’s check or money order could be that those forms of payment ensure the buyer has already paid with cash.

If both parties agree to finalize the sale, you can hand over the title, maintenance records and any other documents required by your state’s DMV.

After the sale

Be sure to remove your plates and return them to your state DMV if you’re required to. You may also need to file a “release of liability” form, which helps ensure you won’t be held responsible for future tickets or other issues that might arise with the car. This should be done immediately after the sale.

Other rules about the transfer of ownership vary from state to state. In California, for example, the seller has to report the transfer of ownership within five days of the sale, but in Texas the name change on the title must be reported within 30 days.

Whatever the requirements set forth by your state’s DMV, make sure to follow them within any stated time frame.

Bottom line

Selling a car can be a headache, but doing it online can help make the process easier. Whether you’re in a hurry or want to take your time to find the right buyer, there may be an online auto-selling option for you. The hardest part might be deciding which website or app you like best.

Updated August 11, 2023

This date may not reflect recent changes in individual terms.

Editorial Note: Intuit Credit Karma receives compensation from third-party advertisers, but that doesn’t affect our editors’ opinions. Our third-party advertisers don’t review, approve or endorse our editorial content. Information about financial products not offered on Credit Karma is collected independently. Our content is accurate to the best of our knowledge when posted.

Written by: Sarah Brady

Pros

• Will beat competing APR offers by .10 percentage points (with conditions)
• Secured and unsecured auto loans
• No prepayment penalties

Cons

• Best rates are only for people with strong credit
• No phone or email applications
• No preapprovals

What you should know about LightStream auto loans

An online lender, LightStream is a division of Truist.

A variety of loan options

One of LightStream’s main selling points is that it offers a variety of auto loans. You can apply for a loan for a new or used car from a dealer or from a private party. You can also go to LightStream for less-common borrowing options, including unsecured loans for a car purchase — meaning your car won’t be used as collateral.

LightStream also offers a loan option for classic cars, with no restrictions on age or mileage. You can use its loans to refinance, buy out a lease, and even finance a motorcycle or RV.

An offer to beat competitor rates

LightStream’s “Rate Beat” program promises to beat other lenders’ offers by .10 of a percentage point if the loan meets certain conditions. This means you can compare lenders and bring your best offer back to LightStream for a slightly better deal if approved.

Just keep in mind that the additional percentage off your rate doesn’t necessarily mean big savings. The more you borrow and the higher your loan rate, the more it can potentially save you. But it still may not add up to a lot. Here’s an example.

Other banks or credit unions may offer bigger rate discounts to customers who qualify or meet special conditions.

Potential for quick funding

If you’re approved for a LightStream loan, you may be able to receive your loan funds the same business day you apply. LightStream deposits the money directly into your bank account, so you can make an offer on a car as a “cash” buyer. This means you may have the opportunity to negotiate for a better purchase price.

No loan preapprovals

Many lenders will give you the opportunity to be preapproved for a loan before you accept a final offer. Preapproval gives you an idea of how much money you’ll be able to borrow, what your interest rate might be and other terms of your loan. This information may allow you to compare offers and negotiate. Just remember that these are only estimates — you’ll have to officially apply to finalize your rate and other terms.

With LightStream, the only way to get an offer is to submit an application for a car loan, which will trigger a hard credit inquiry by LightStream. If you don’t like the offer, you can choose not to accept the loan, but the credit inquiry could still cost your credit scores a few points.

A closer look at LightStream auto loans

Here are some other LightStream auto loan features to consider as you compare it to other lenders.

• Fixed-rate loans only — Variable rate loans aren’t available. And LightStream only offers its Rate Beat program on fixed-rate loans from other lenders.
• Rate quotes include an Autopay discount — If you opt out of autopay for your monthly payments, your rate will be .50 percentage points higher.
• $100 loan experience guarantee — If you receive a loan and you’re not completely satisfied with the process, fill out a survey within 30 days of receiving your loan and LightStream will send you $100.
• A tree planted for every loan — LightStream plants one tree for each loan. The lender also offers “virtually paperless” loan processing and services.

Is a LightStream auto loan right for you?

LightStream targets people with solid credit and gives the best rates and terms to those who fit that profile. People with the strongest credit may even be approved for an unsecured loan.

Lenders can define excellent credit in different ways. LightStream says its customers with excellent credit usually have …

• Five or more years of credit history
• A mixture of installment loans and credit cards
• A record of on-time payments
• The ability to save money
• A stable income

LightStream offers its lowest rates for new and used cars when you borrow between $10,000 and $24,999.

If you’re looking for a different amount of financing, you may still be able to get a good rate through LightStream’s Rate Beat program, but you’ll have to do the extra work to shop around and bring back your offer from another lender.

How to apply for a loan from LightStream

You can apply online for a LightStream auto loan. If you’re approved, you’ll have 30 days to transfer the loan funds into your account.

But before you apply for an auto loan with LightStream, it’s a good idea to check your credit and compare other loan offers. Understanding your credit can help set expectations — in general, lower credit scores will result in higher interest rates. And shopping around can help you find the best loan rate and terms for your needs. Read our article on how to get a car loan to learn more about the process.

Auto loan alternatives to consider

It’s worth considering another option if LightStream doesn’t seem like the best one for you. Here are two more to consider.

• Capital One Auto Finance auto loan: Capital One Auto Finance could be great for someone who’s rebuilding their credit.
• Alliant Credit Union auto loan: Alliant may be a good choice if you want to apply for a loan preapproval online or use the credit union’s car-buying service.

If you’re longing to feel the wind in your face while you’re roaring down the open road, buying a motorcycle might be on your mind — and that could mean shopping for a motorcycle loan.

Many lenders offer financing for motorcycles, so you’ll want to compare interest rates and loan terms to get the best deal for you. Even if you’ve financed a car purchase, you’ll find parts of the motorcycle-buying process to be unique. Understanding what to look for will come in handy.

Before you head to the dealer, examine your budget and decide if you need a loan at all. Paying cash may be your best option if you can make it work financially.

• What is a motorcycle loan?
• Where can I get a motorcycle loan?
• Tips for getting a motorcycle loan

What is a motorcycle loan?

Motorcycle loans are often secured loans, meaning you must back them up with collateral — in this case, the collateral is usually the motorcycle itself. When you get a secured loan, your property can be repossessed by the lender if you fail to make your payments.

If you’re concerned about using your motorcycle as collateral against your loan, you may consider applying for an unsecured personal loan. But be aware that unsecured personal loans can be viewed as a greater risk by lenders since they can’t take your property if you fail to meet the terms of the loan. This is why unsecured loans typically come with higher interest rates and may require higher credit scores for approval.

Motorcycle loan types

If you shop around for motorcycle financing, you may notice that lenders usually classify motorcycle loans and auto loans differently. Some lenders may charge higher interest rates for motorcycle loans than they might for an auto loan.

Some lenders break motorcycle loan types into more detailed categories, with options for new versus used bikes and specifications about what is and isn’t considered a motorcycle. Certain lenders won’t offer financing for a dirt bike, scooter or ATV. Others may not even finance motorcycles at all.

Where can I get a motorcycle loan?

You can shop for your motorcycle loan online or in person. Getting started is as simple as asking for quotes and comparing financing options.

Getting a motorcycle loan from a bank, credit union or online lender

When you apply for a motorcycle loan through a traditional lender like a credit union or bank, you can often apply for preapproval. Just like an auto loan, your motorcycle loan preapproval will likely include a quote on loan terms like an estimated interest rate and the amount you may be able to borrow. Traditional lenders can also offer unsecured personal loans, if you decide to go that route.

Your preapproval can help guide your shopping experience. It’ll give you an idea of how much financing may be available and you can look for the best deal for you within that price range. Just remember: Preapproval doesn’t guarantee you’ll get the loan — you still have to apply and get approved, and then the terms of your loan may also differ from the estimates provided in the preapproval.

Loan preapproval may affect your credit scores — it depends on if the lender uses a hard or soft inquiry. When many lenders preapprove you for a loan, they’ll perform a soft inquiry on your credit, which doesn’t hurt your credit scores. If you choose to apply for the loan you’ve been preapproved for, the lender will usually perform a hard inquiry, which may cost you a few points off your credit scores.

Getting a loan from a dealership

You may decide to arrange financing through a dealership instead of going on your own to a bank. Some motorcycle dealers will submit your loan application to lenders on your behalf to help you secure financing.

While going through a dealership may seem more convenient than finding your own loan, it usually costs more since dealers often add fees to the lender’s quote. It can also stop you from comparison shopping at other locations.

Some dealerships offer a less favorable option: in-house financing. In-house financing, provided directly through the dealer, is often aggressively marketed to buyers with poor credit. While this option might appeal to you if your credit isn’t in great shape, loans financed in-house — also known as “buy-here, pay-here” loans — tend to come with much higher interest rates, meaning the overall cost of borrowing will likely be greater.

Getting a loan from a manufacturer

Some motorcycle manufacturers offer loans online. Harley-Davidson, for example, offers the opportunity to apply for a loan online. BMW also offers the opportunity to apply for motorcycle financing directly through its dealerships.

Tips for getting a motorcycle loan

While your motorcycle loan may not be as big as an auto loan, the terms of your loan still matter. Whether you’re borrowing $3,000 or $30,000, starting with a bit of research and preparation can help you find a loan that works for you.

Review your credit

Your creditworthiness can affect the terms you qualify for, including your interest rate and monthly payment. If you’re thinking about applying for a motorcycle loan, check your credit scores to see if there’s an opportunity to improve your scores and possibly get a better interest rate.

Determine what you can afford

Before you fall in love with a new motorcycle, figure out what you can afford to pay. Here’s a good rule of thumb to consider: Your auto payments shouldn’t exceed 15% of your monthly net income. Ultimately, affordability depends on the details of your personal budget.

Comparison shop

Making comparisons throughout the shopping process may help you find not only the lowest sale price on a motorcycle, but also the best deal on a loan. The difference between 5% and 6% interest rates may not seem like a lot. But over the course of a four-year repayment on a $15,000 loan, getting a 5% interest rate, instead of 6%, could mean saving hundreds of dollars in interest.

Here are some other figures to look for, compare and even negotiate.

• Total dollar amount you’re borrowing
• Monthly payment amount
• The interest rate
• Total finance charges (interest plus fees)
• Additional fees, like a late-payment or pre-payment penalty

Make sure to check the total annual percentage rate, or APR, since it should include your interest rate and certain fees in your loan agreement, like an application or origination fee.

Bottom line

Finding a good motorcycle loan for you can involve a bit of work. There’s no one-size-fits-all financing method for your new bike, but if you’re willing to research the market, compare estimated interest rates and calculate how much new debt you can afford to take on, you’ll be in a better position to make a deal that’s best for you.

According to a AAA survey, a new car costs an average of almost $1,200 per year to maintain and repair — and only one-third of U.S. drivers are financially prepared to cover unexpected repair costs.

If you need an auto repair that’s not covered by your warranty or your insurance, and you don’t have the cash on hand, there are a few ways to help you get the financing you need. Let’s review some options and compare pros and cons of each.

Financing auto repairs with a personal loan

A personal loan is one option that could help you get the money you need for your car repair. And depending on the lender and whether you’re approved, funds may be deposited into your checking account as soon as the next business day. These types of loans are installment loans, meaning lenders will allow you to pay back the money you borrow over time through regular monthly payments. In addition to the amount you borrow, you may be required to pay interest and fees, which can vary from one lender to the next.

Your credit history is one factor that may affect your ability to qualify for a personal loan — and if you’re approved, your credit will likely affect the terms and interest rate you’re offered. If you want to take out a personal loan for auto repairs, but can’t qualify for the loan or the rates you want, you may want to consider applying for a personal loan with a co-signer, who can help give the lender confidence that the debt will be repaid.

Here are some places you can go for a personal loan, and how those loan options compare.

Traditional loans

Banks and credit unions can be a good starting point for a personal loan when you’re ready to shop for competitive rates. Online lenders are another option to consider — you can compare terms on auto repair financing between all the personal loan lenders you’re considering to look for the best loan terms for your situation.

But before you borrow money from any financial institution, you should review the terms of your personal loan.

• Principal: The principal is the amount of money you’re borrowing, excluding interest and fees.
• Fees: Fees are extra costs that may include application fees, origination fees, late fees and prepayment penalties.
• Interest rate: Interest rate is what you’re paying to borrow an amount of money, usually expressed as a percentage of the amount you’re borrowing. This does not reflect fees or any other charges associated with taking out a loan.
• Annual percentage rate: APR is the annual cost of borrowing. It includes certain borrowing fees, so it’s typically higher than your interest rate.
• Repayment term: The repayment term is the length of time you have to repay your loan. It’s usually expressed in months.

Tip: Thinking about getting your auto repair financing from a payday lender? Consider reaching out to your credit union to learn more about a payday alternative loan, which can be an affordable loan option for some. These loans range from $200 to $1,000 and are paid back over a one- to six-month period, with a 28% APR cap.

Payday loans

Payday loans, sometimes referred to as cash advance loans or check advance loans, typically require that you provide a post-dated check or give the lender permission to make an automatic withdrawal from your bank account. Payment for the full loan balance, plus fees, may be due by your next payday.

Borrowing against your future paycheck has limitations — as well as risks. In states where payday loans are allowed, the maximum loan amount may be capped at a set amount. Even with such a small loan, the fees can be astronomical — equal to APRs as high as 400% or more. And additional fees may be charged if you don’t have the funds available in your account when the payment is set to go through, or if you roll over the loan for another reason, if allowed.

Title loans

Like payday loans, car title loans are risky short-term financing options. If you’re approved for a car title loan, the lender provides a loan in exchange for your car title. When you repay the loan and fees, which are usually due 30 days after the loan is issued, you can get your title back.

But if you fail to pay, you either face a vehicle repossession or have to cover “rollover fees,” on top of other fees, so that you can delay your loan repayment date.

This can be a very expensive and risky way to borrow money. The typical APR for a car title loan is 300%. According to the Consumer Financial Protection Bureau, more than two-thirds of auto title loan borrowers roll their payment over at least six consecutive times due to the difficulty of repaying the high costs. The CFPB also found that one in five borrowers ends up having their vehicle repossessed because they can’t repay their debt.

Financing auto repairs with a credit card

Using a credit card could be a quick and convenient option for covering an emergency auto repair — for some. But weigh these options before you reach for plastic.

Existing cards in your wallet

If you’re considering turning to a credit card you already have, know that paying for your auto repair with a credit card may not be cheap. For example, at an APR of 15% with a $25 per month payment, a $1,000 repair could take you 56 months to repay and cost you almost $395 in interest. At 20% APR, it would take 67 months to pay for the repair and cost you almost $662 in interest.

For that reason, we recommend using an existing credit card only for purchases you can comfortably afford to pay on time and in full within one billing cycle.

New card with a low introductory APR

While using an existing credit card may hit you with high-APR costs, there are other ways to pay for an auto repair with a credit card. If you want to avoid getting hit with high interest charges, check out credit cards that offer introductory 0% purchase APRs. With these credit cards, you can avoid interest charges on your purchases during an introductory period after your account opens — typically, this time lasts for about 12 months to 21 months. But be aware: After the intro period ends, your card will have an APR. If you don’t pay your balance off before the intro period is up, the remaining balance will get hit with the APR.

If you qualify for a card that offers an intro 0% purchase APR, and know you can repay the full balance of your auto repair charges before the intro period ends, using a credit card could be the most affordable way to finance your auto repairs.

Branded cards from your mechanic or auto supply store

Some mechanics or auto parts stores offer financing options for car repairs through branded credit cards.

Synchrony offers a Synchrony Car Care™ credit card in partnership with a number of major auto repair chains — including Midas, NAPA Auto Parts and Discount Tire — that allows customers to apply for a co-branded credit card that can be used to pay for repairs, maintenance, gas and more.

And Napa AutoCare, for example, offers customers a NAPA EasyPay credit card through Synchrony that includes some perks and no annual fee for new cardholders.

Bottom line

Comparison shopping isn’t just useful for getting the best deal on jeans or a new kitchen appliance. It can help make your auto repair financing more affordable, too.

Before you take out a loan or apply for a new credit card to finance your car repair, compare quotes for the repair work you need. Ask mechanics about pricing before you take your car to the shop and consider asking for a written estimate.

Once you decide where to have your repairs done, you can compare loan offers to make sure you’re getting the most cost-effective deal available for you.

And before you get stuck in the same boat again, start building up an emergency fund for future financial needs.