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Can You Finance Two Cars on One Loan?

Usually, you cannot finance two cars on one loan. There are several reasons why not, but the main one is that a lender will see it as being too risky of a loan. That risk impacts not just them, but you the borrower as well. Think about it:  what happens if you lose your job and are forced to take a pay-cut for a hastily-secured new position? You may not be able to afford that single large payment any longer. However, if you had two smaller payments, and worse came to worse, you could voluntarily surrender one of the vehicles to the lender. Doing so would be bad for your credit, as it would be a type of voluntary repossession, but it would allow you to keep at least one car, making the smaller of the two payments. If, on the other hand, both cars fall under one single large payment, you would lose both of your cars and, possibly, your job because you may not have transportation to and from work!

For this reason, financing separate cars with separate loans is the lower-risk approach. Go here for more information on how much you should be spending on a car each month.

Consolidating Two Car Loans into a Single Loan

Some lenders will allow you to consolidate two car loans into a single loan, but the loan will only be for one of the vehicles involved. In this process, a lender will consider the value of the vehicles involved, the loan balances to be combined, then your credit score, and everything else normally considered during the loan process. The key element is that most banks will not allow you to have a loan balance that is more than 115 percent of the value of the car. This is called a vehicle’s loan-to-value (LTV). Still, even if you are able to consolidate your loans, only one car is being financed.