Can I Include My Stereo on a Car Loan?

When you get a car loan, the loan will encompass the entire cost of your car minus the down payment. When you are buying a car, your stereo is obviously part of the car and is thus included in your loan. If you upgrade the factory stereo (e.g., adding a multiple-disc CD player), you can still get that covered in the loan.

I Want to Listen to My Tunes!

When you are ready to get a car loan, you need to get an estimate on the amount of the loan. If you go to a financial institution to get your loan, they will give you an estimate based on what the car is worth. If you upgraded your stereo to top quality, that is going to make the car more expensive. This will drive up the estimate of the loan to include the stereo. If the stereo is more of an afterthought, you might not be able to get it covered in the loan. Be sure of what you want; that way, when you go to apply for your loan, you take out the right amount. Including your stereo in your car loan is common, and it works the same way as including any other costs in your loan. It all comes down to the estimate of how much the car is worth. If you get the bare minimum on your car, then it is obviously going to cost a lot less than the same car with all the bells and whistles. The lower the price of the car, the lower the cost of the loan.

There Is Nothing Wrong with Noting the Upgrade

Don’t worry about thinking that you will be pulling a fast one on the loan. The loan, however, will not cover anything dealing with the stereo outside of what can be done by the manufacturer. So, for example, if you want to go to your local stereo shop to get a new set of extra large speakers, that must be kept separate. You cannot use a car loan for that purpose. A car loan can only cover the upgrades you make to your stereo through the manufacturer at the time of purchase. The loan will work for a stereo the same way it will work for upgraded features like anti-lock brakes, tinted windows, etc.

So go ahead and get the upgrade in the stereo system. If you want it and can afford it, you should get what you want. The loan will cover it when you upgrade at the point of purchase. The estimate for the loan will take it all into account. The important thing is to make sure you can cover the extra expense. You do not want to get upgrade-happy and then find yourself unable to pay off the loan. So it is up to you to set the features on your car. Your loan will be able to cover it, but don’t get in over your head.