Getting a car loan approved is not always an easy task, but luckily there are some things you can do to help improve your chances. Here are five things to do when applying for a car loan to make the process as seamless and stress-free as possible!
Check your credit score
This is something that you should do before applying for a car loan, as the lender will check yours as part of the application process. If it’s too low, then you’ll be rejected immediately; but if it’s within “good” limits, then there shouldn’t be any problems. It’s a good idea to go through your credit history to check if there are any errors on your credit file. If there are, make sure you contact a credit bureau to get these fixed before applying for any loans. Keep in mind that the higher your credit score is, the lower interests rates you’ll be eligible for because lenders will view you as a less risky customer.
Have your details on hand
The lender will need your personal information before they can do anything, so make sure you have this to hand. This includes your name, date of birth, phone number, driver’s licence details and bank account details. You may also have to provide proof of address by way of a recent utility bill or council tax statement.
Get pre-approved for the loan
Before you head down to your local car dealership, you might like to get pre-approved for the loan. This is essentially a preliminary approval before you’ve actually finished the process of applying for it. It’s good to do this because it helps speed up the application process with your chosen lender, but also if they can see you’re pre-approved for the loan, they may be able to offer you a better deal.
Shop around for prices
Before you start applying for loans, it’s always best to make sure you know what price range of car you can afford. There are many factors that will affect your monthly repayments, like the selling price of the vehicle, the interest rate and the length of the loan, so do your research in order to avoid any nasty surprises! This will also help you when it comes time to actually compare car finance offers, as it doesn’t matter how good the offer sounds if your monthly repayments are too high for you to afford. To see all of your personalised loan options in one place, make sure you check out Driva car finance.
Get organised ahead of time
By getting organised ahead of time, we mean that you need to be prepared financially. If you haven’t got the money in the bank to pay for a car in one go, then make sure you know what your credit score is and how much it will cost in monthly repayments (both on the car finance deal and other debts like your student loan or credit card bills).