|January 9, 2017||0|
If you’re looking for finance to help you buy a car, the usual car-buying process involves you finding a car, then applying for a loan to help you buy it. Pre-approval is available before you head for the car dealership so you can head there knowing how much you’re approved for. Find out everything you need to know about pre-approval, and contact us to compare some of your options.
The ins and outs of pre-approved car finance
When you apply for pre-approval, your financial circumstances will be evaluated and the lender will determine how much you can afford to borrow. During the process you’ll need to provide similar details as you would provide a normal loan. It’s important to note that pre-approvals are only valid for a short space of time.
A huge benefit to a pre-approved car loan is it gives you an advantage when you need to negotiate the price of a vehicle. You know how much you can spend, so you can make an offer there and then. However, this means you also means you know your budget limitations, so if the salesperson can’t meet your negotiations you’ll have to walk away.
What is conditional approval?
Conditional approval is given when you’re initially approved for a pre-approved car loan. Based on the details you provided during the pre-approval process, the lender says you can borrow up to a certain amount.
Unconditional approval is when the lender approves you for the loan to buy a specific vehicle. Lenders have restrictions with the types of vehicles they will finance, so need to be sure that the car fits within these restrictions before giving the final green light.
How to get pre-approved for a car loan
What types of car sales can I use with a pre-approved car loan?
Pre-approved car loans can be used to purchase cars bought through a dealership, at private sales and at auction. These are all the types of situations you can expect to use a regular car loan for. So in that regard, pre-approved car loans serve the same purposes as regular car loans.
The type of vehicle, age and whether purchased privately or through a dealer (new or second hand) needs to be advised at the time of pre-approval.
Have you weighed up the benefits and drawbacks of pre-approval?
Pre-approved car loan features
Like the best features on the market? You can get some of the best features and interest rates on the market with pre-approved car loans.
Things to consider before applying for pre-approval
There’s probably a few things you should do before buying a car, and these will vary from person to person. Here’s a few things to keep in mind.
How do I apply for a pre-approved car loan?
Contact us to see if you qualify for a pre-approved car loan.
Please have your information handy such as your income, employment details, other income, assets, liabilities and 100 points of ID.
Have more questions about pre-approval?
You asked and we listened. Here are the top questions you’ve had about getting pre-approval on your next car loan
Should I get a new or used car?
As with any large purchase, it’s important to compare your options. You should choose a car based on the features you want, and then pick one in your budget. There are benefits and drawbacks to both new and used car purchases, for instance, used cars can be a bargain but can come with unknown mechanical problems, while new cars come with a factory warranty but depreciate quickly.
Take a look at our used car buying guide here to get an idea of what might be in store.
Are there any extra costs I should be worried about?
Who can actually get pre-approval?
You’ll have to be 18+ and a permanent resident or citizen, have a job and a regular income and be able to afford your loan repayments.