Do You Need Full Coverage on a Used Financed Car?

If you’re thinking about financing a pre-owned vehicle, you may be wondering, “Do you need full coverage on a used financed car?” This is a question our finance team at Bill Luke Tempe receives a lot, and it’s important to understand that full coverage is a way for both you and your lender to protect your investment. Here is what you need to know about required insurance coverage for used financed vehicles.

How to Finance a Used Car: The Basics

So, do you need full coverage on a used financed car? Like most states, Arizona does not legally require vehicle buyers to have new insurance in place before they drive off the lot. But it’s always a good idea, as you want to be protected as much as possible from the moment you sign on the dotted line.

Whether you’re financing a new vehicle or a used one, your loan term is the length of time in which you’ll make payments before you own the vehicle free and clear and receive the title. For example, if you choose a loan term of 60 months, the lender will retain the title for the five years you’re making payments; then, when the loan has been paid and the term completed, the lender transfers the title to you.

For the vast majority of used car financing packages, full coverage insurance will be required by the lender for the full term of the loan. This is a way for the lender to protect their investment in the vehicle and to minimize your out-of-pocket costs in case you’re involved in an accident or other covered event.

How Many Years Can You Finance a Used Car?

Different lenders offer different loan terms, so there is no one standard length for a used car loan. With that said, you can typically choose from loan terms ranging from 12 to 84 months. Credit history, down payment, and trade-in value all affect the length of the financing period options available to you.

At Bill Luke Tempe, we aim to make vehicle financing easy and accessible for drivers throughout the Phoenix and Chandler area. We can start working on your financing package as soon as you find a used vehicle that checks all the boxes on your wishlist. You’ll need to provide us with a valid driver’s license and insurance card, as well as proof of income, like your most recent pay stubs. From there, we can match you with the right loan options and let you know how many years you can finance a used car.

Trust Bill Luke Tempe for All Your Used Car Financing Needs

We’ve answered some important questions here: Do you need full coverage on a used financed car? How many years can you finance a used car? Our team is here to help at every stage of the financing process. Don’t hesitate to contact us with any questions or to get the ball rolling on your application. You can also stop into our Tempe showroom–just a short drive from Queen Creek–and check out our latest selection and meet our finance team in person. We look forward to making sure you find the best vehicle for your lifestyle and budget while helping you protect your investment at every step.