A question about an auto loan...?

I have a limited credit history but I want to buy a used car. The car is up for sale for $5,400. I was looking up places to get a loan and I checked capital one since I already have a credit card through them. I researched their auto loans and the lowest amount they will loan out for an automobile is $7,500. This means theres an extra $2,100 that won't go towards the vehicle. Is it against the law to use the extra money towards credit card debt and to pay my car insurance in full so that my only monthly payment I will have at all is the auto loan?

If it is legal, is it a bad credit decision or does it sound acceptable?

Also, once I own the new car, I will put my old car up for sale (worth over $3000) and use that money plus my tax refunds and extra money coming from my financial aid to go towards the auto loan.

Bad? Okay? Any other ideas?

In all honesty, I doubt you'll be able to get an auto loan from Capital One with a limited credit history. They're pretty strict. What you want to do isn't illegal, but considering the interest rate on the car, you'd probably want to take the extra money and add it to your first loan payment providing the loan terms allow it.

But again, I doubt they'll finance it. Be aware of how your credit affects your potential auto lender choices: http://www.creditave.com/auto-loans/cred... and also be on the look out for bad lenders: http://www.creditave.com/auto-loans/auto...

Good luck.

Auto finance is what I do for a living and no it's not illegal to use the rest of the money on something else.

What you will have to watch is will Capital One actually give the loan for the car you want, they have very strict guidelines as far as age, miles, types of vehicles, income, time on job, time at residence and loan to value.

Good luck

You can shop around and get a consolidation loan and put up the car as collateral.

It is hard to say. You have to check it out yourself.here is some useful information for your question might be helpful.http://loan.online-supporthome.info/comm...

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