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Borrowers may qualify for a rate-reducing loan, which reduces your loan’s interest rate after 12 consecutive months of making payments. This perk comes with certain conditions, so be sure that you can meet them before signing on the dotted line. Otherwise, you may end up with a car loan that costs more than you anticipated.
$50,000
Max. Loan Amount
N/A
Min. Credit Score
If you’re shopping for a vehicle and auto loan at a dealership, there’s a good chance your dealer may submit your loan application to iA Auto Finance among other lenders. iA Auto Finance is a subprime B2B auto finance company that provides auto financing through dealers only, so consumers can’t apply directly to this lender. Because of this set-up, consumers can’t see detailed information on interest rate ranges, loan amounts and loan types they may qualify for until they apply.
iA’s shining feature is its Rate Reducing Loan, which allows borrowers to pay off their loan faster, reduce their interest rate each year and rebuild their credit in the process. However, you only qualify if you meet certain requirements. So if you fail to meet these requirements and your car loan has a high interest rate, you could end up with a loan that costs more than you anticipated.
Existing iA Auto Finance borrowers may qualify for the lender’s rate-reduction loan, which cuts the interest rate by 10% of the current interest rate each year.
iA Auto Finance says you may qualify for a rate reduction 12 months into the loan term if you’ve met its requirements, namely making monthly payments on time for 12 months straight. If you miss a payment or miss the mark on other stipulations, iA will reset the clock to month 1. You can try for the rate reduction again if you meet all the requirements over the next calendar year.The other requirements include ensuring no payments are returned for any reason, keeping your vehicle accident-free and keeping iA up to date with your insurance policy. Before signing the contract, understand all the requirements to get your rate reduction.
While the eligibility criteria aren’t disclosed online, you’ll need to meet the following basic requirement:
Details on minimum credit score and monthly income requirements aren’t disclosed online. You’ll need to consult with your dealership to ask for these details.
iA says it’s partnered with dealerships across Canada, but its reach may vary in smaller towns compared to major cities.
Borrowing via iA Auto Finance comes with a slate of perks, including the following:
Borrowers should take note of the following red flags:
Before signing a car loan with a dealership, consider comparing it with other offers so you know whether you’re getting the best deal.
It is. iA Auto Finance is part of the iA Financial Group, one of the largest insurance and wealth management groups in Canada, with reach into the United States. iA was founded in 1892 and is listed under the Toronto Stock Exchange as IAG (common shares) and IAF (preferred shares).
It provides individual insurance, wealth management and group insurance as well as auto and home financing. The larger iA Financial Group says it manages over 4 million clients as of December 2020.
iA provides auto financing through partnered dealers only, so you’ll need to apply via the local dealership where you’re car-shopping. iA says that once you’ve found the car you’d like to purchase, work with your dealer to submit your auto financing application. From there, your dealer will submit your application to various lenders, including iA, to see if you qualify and under what terms.
Check with your dealer to see if iA has requirements for a minimum credit score and monthly income to make sure you fit the criteria.
While iA doesn’t disclose which documents you’ll need for the application, these documents are typically required to verify your identity and financial information:
Before you’ve secured your financing to purchase your car, read through the loan contract thoroughly to make sure you understand what you’re committing to. Pay attention to the monthly loan repayment amount, due date, interest rate you’ve qualified for and the overall loan term.
With these details in hand, make sure to stay on top of your loan repayments. If you’re diligent without missing any due dates, you may qualify for an interest rate reduction at each anniversary of your loan. This is a perk worth aiming for because you could save thousands in interest over the lifetime of your loan. The onus is on you to email or call iA to get your rate reduction.