What is the Difference Between a Personal Loan and a Car Loan?

A personal loan is best for financing large, one-time expenses like a home improvement project. An auto loan is used specifically to finance the purchase of a car. You can use a personal loan to finance a new or used car, but it isn’t recommended. An auto loan is a better option that is often easier to qualify for and comes with a lower interest rate. Plus, with an auto loan, the car is used as collateral, which protects your other assets.