Loan approval can be secured on any credit score and vehicle. While approval may not be guaranteed with every lender, you can minimize the chances of rejection or administrative delay by following these guidelines for getting an auto loan:
- Consider All Options Carefully
Not all lenders are created equal, and some may not be willing to accept your poor credit or no credit history. Therefore, it’s wise to be thorough when searching for a loan; create a budget beforehand.
- Look Beyond the Interest Rate
Interest rate should not be your only consideration when selecting a lender. You should also take into account their fees and service standards if you’re willing to deal with companies that have poor ratings.
- Have Your Paperwork Ready
Before applying for an auto loan, you must have a current credit report. Lenders won’t deal with you until they receive it. Moreover, proof of income and current employment as well as good standing at your local DMV are essential requirements.
- Make Sure You Meet the Requirements
Your lender may require that you have an open bank account in order to process the application. Furthermore, determine what kind of collateral they accept before proceeding with the loan process.
- Research other lenders when searching for financing
Most lenders charge an origination fee when they extend a loan, so it pays to do some research before reaching out directly. Comparing loan costs may be worth doing even if there’s no guarantee that you will be approved by the one offering the lowest interest rate.
- Be ready with the car
Before applying for an auto loan, make sure your vehicle is ready to go. A new or used cars in sacramento that passes inspection and has good mileage is ideal so that you can get rolling sooner.
- Arrange an Appointment
It’s wise to call ahead when making an appointment so the lender has time to prepare. Additionally, if they will be showing you your loan agreement, bring along some writing supplies in case you require a copy for yourself.
- Open a bank account for your loan
If the lender cannot process the loan immediately, there may be a delay of one to two months until they send the check to your bank account. It’s best to have an established bank account beforehand so you can start using the money promptly after receiving it.
- Utilize Alternative Sources of Funding
Consider collateral-free sources such as rental financing programs and online lenders who may offer better rates than traditional lenders.