Car loans - how do they work?

deutsch`

My brother is going to be graduating high school soon and starting college and he doesn't have a job/car. So I want to give him my car which I will still pay for everything but his gas, I'll pay car payment/car insurance. And I'll buy myself a new car.

I don't have the credit to get a loan out or won't have the money to pay for it. But my grandfather has agreed to pay for it and get the loan out until I graduate in around 6 months with my bachelor's and then I can start paying for it.

I like to fix cars up to make them more reliable/gas mileage, and the speed as well.
Intake, springs, shocks, headers, timing belts, water pumps, throttle body, etc.

So if I wanted to buy a car for $10,000 and put like 3-4 thousand of work into it, would he be able to get a car loan out for lets say $14,000. Then I could cash that and buy the car and fix it up?

Or would all $14,000 have to go towards the car? I'm not sure how car loans or loans in general work. Should he get a certain type of loan? Will one have less interest?

I know everything about my student loans and grants but nothing about these types of loans.

Thanks.

epsilondraconis

High school, dollars - if you are based in the US, it's probably a good idea to post on a US money saving website.