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Why are automobile loan rates higher than mortgage rates?


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Answered 2009-01-13 09:28:28

Car loans are riskier than home loans. The car looses value from day one, is in danger of collision and theft and has a limited life span. In addition, the vehicle can 'disappear' in a hurry, leaving the lender holding the bag. Homes are not mobile, real estate traditionally increases in value and the loan is over a much longer period of time.

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