 TITLE: What Is the Best Way to Pay for a Car? CONTENT: Explore Other Borrowing Methods\n-------------------------------\nThere are a few other, less common ways to finance a car. These typically aren't recommended, but here's what you should know.\n*   **Credit cards**: Wondering if you can buy a car with a credit card? Dealerships often have limits on how much can be put on plastic; but you may be able to use a card to cover some or all of your down payment. You may even be able to pay the entire purchase amount with a card depending on dealership policies and your credit limit. If you plan to put some of all of the car on your credit card, you may need to contact your card issuer first to make sure the large transaction will be approved.  \n    Before moving forward, understand that this payment method could be unwise for several reasons, not the least of which is the fact that credit card interest rates are usually much higher than auto loans. Furthermore, carrying a large balance can hurt your credit since it'll drive up your credit utilization ratio. If you can't pay it off right away, opt for an auto loan instead.\n*   **Personal loans**: Just like auto loans, personal loans are installment loans that are repaid monthly with interest. They differ in that they are usually unsecured loans, so if you buy a car or anything else with a personal loan, it can't be repossessed if you don't pay (but your credit will take a big hit). While personal loans may be easier for car buying if you're purchasing a vehicle from an individual rather than a dealership, their interest rates are usually higher than what you'd get from a comparable auto loan. So if you're looking to spend the least amount of money, an auto loan is usually your best bet.\n*   **Borrow from a loved one**: If you have a friend or family member willing to give you an interest-free loan, asking for their help could get you behind the wheel of a new car and save you a lot of cash in the process. You don't have to borrow the entire amount either; this could be an option to make up the difference if you don't have quite enough to complete the transaction. This method isn't one you should count on, though, since it can be hard to find and persuade someone to go through with this. Additionally, failure to repay can irreparably damage your relationship with whomever you borrow from. If you do choose this option, draw up a promissory note that outlines the terms so your lender can be confident you'll repay. END