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Get preapproved for a car loan

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Up your bargaining power before heading to the dealership.

Walking into a dealership with a preapproved loan allows you to lock in rates and terms on a loan before shopping for a car. It can help you set a budget and give you bargaining power to get an even better rate at a dealership. However, it can limit how much you’re able to spend on your new car.

Our top pick: car.Loan.com Car Loans

  • Min. Credit Score Required: 300
  • APR: Varies by network lender
  • Requirements: Must be a US citizen with a current US address and employed full-time or have guaranteed fixed income.
  • Easy online application
  • Fast response time
  • Bad credit, no credit OK

Our top pick: car.Loan.com Car Loans

Apply with a simple online application to get paired with a local auto lender. No credit and bad credit accepted.

  • Min. Credit Score Required: 300
  • Requirements: Must be a US citizen with a current US address and employed full-time or have guaranteed fixed income.
Promoted

6 providers that offer preapproval on car loans

Lender How long preapproval lasts APR Terms Eligibility
myAutoloan.com Varies by lender 2.49% 2 years to 7 years Must have a Social Security number; make $24,000+/year; have no open bankruptcies.
Go to myAutoloan.com's site
LendingTree Varies by lender 2.29% 1 year to 7 years 18+ years old, good to excellent credit, US citizen
Go to LendingTree, LLC's site
Navy Federal Credit Union 60 days 2.99% 8 years Credit union member, US citizen or permanent resident, have age of majority. Read review
Bank of America 30 days 3.54% 1 year to 6.25 years Ages 18+, US citizen or permanent resident, buying eligible vehicle Read review
Capital One 30 days 3.24% 3 years to 6 years Valid street address, existing Capital One account in good standing, buying 2009 model or newer with less than 120,000 miles Read review
USAA 45 days 2.89% 7 years to 1 year USAA member, US citizen or permanent resident, ages 18+ Read review
CarFinance.com 30 days 4.99% 6 years Age 18 years or older, credit score 500+, to refinance loan car must have less than 100,000 miles, no more than eight years old and loan balance must be $7,500+ Read review

Find a car loan that’s right for you

Updated June 25th, 2019
Name Product Filter Values Minimum Credit Score Loan Term Requirements
300
Varies by lender
Must be a US citizen with a current US address and employed full-time or have guaranteed fixed income.
Apply with a simple online application to get paired with a local auto lender. No credit and bad credit accepted.
600
Varies by lender
Fair to excellent credit, an income source, US citizen or permanent resident, 18+ years old
Find an offer and get rates from competing lenders without affecting your credit score.
300
Varies by lender
Must be employed full-time or have guaranteed fixed income of at least $1,500/month and be a current resident of the US or Canada.
Get connected with an auto lender near you, even if you have bad credit.
Good to excellent credit
2 to 7 years
Good or excellent credit, enough income or assets to afford a new loan, US citizen or permanent resident, 18+ years old
Quick car loans from $5,000 to $100,000 with competitive rates for borrowers with strong credit.
Fair or better credit
From 2 years
Car must be less than 10 years old with fewer than 120,000 miles. Current loan must have a balance between $5,000 and $55,000 and at least 24 months left in its term.
Lower your monthly car payments and save on interest through a fast and easy online application process.
510
Varies
Income of $2,000+/month, vehicle has less than 150,000 miles and is no older than 8 years, loan balance is between $10,000 and $100,000, debt-to-income ratio is less than 50%
Connect with a network of over 150 lenders to refinance your car loan.
Good to excellent credit
Varies by lender
18+ years old, good to excellent credit, US citizen
Compare multiple financing options for auto refinance, new car purchase, used car purchase and lease buy out.

Compare up to 4 providers

5 tips to get preapproved on a car loan

Here’s a few things to keep in mind before you buy your new wheels:

  1. Research your car. The make. The model. The year. The color. Also take gas efficiency costs into consideration.
  2. Check your financial standing. Car loans are an extensive financial commitment. Be sure that a loan is something you can realistically fit in your budget.
  3. Test drive your car. Taking the car for a test drive helps you determine if there are any issues.
  4. Take the car to a mechanic. Even if it costs a little extra, having a mechanic eyeball for any problems under the hood could save you a boatload of money down the line.
  5. Shop around. Your next car may be at several dealers — it could be a good idea to not to buy the first car you see.

Why get preapproved for a car loan?

  • Confidence in your financial situation. The lender assessed your finances and gave you the green light to purchase a vehicle, so you don’t have to stress about securing financing.
  • Bargaining power. Knowing how much you can spend gives you the upper hand when negotiating a price at the car dealership.
  • Fixed interest. A fixed interest rate can help you maintain a budget without having to worry about fluctuations in the market raising your interest rate.

Why might I want to hold off?

  • Short approval time. Auto loan preapproval is often only available for between 30 and 60 days.
  • Limited budget. Because you’ve been preapproved for a set amount, your car options may be limited.
  • Smaller market. Not all lenders offer preapproval compared to standard car loans.
  • Secured loan. Your loan option may be based on the condition that the car be used as collateral if your credit is poor. In this case, the car will be repossessed if you can’t make payments.

Should I get preapproved for a car loan?

It depends on your situation. You might want to get preapproved for one of the following reasons.

  • You’re new to lending. Getting preapproved can give you an idea of what type of loan you can actually get without the commitment.
  • You want to negotiate. Going to a lender with a preapproved rate in hand is key to making a solid case for yourself.
  • You aren’t set on a dealership. Having a preapproved car loan effectively makes you a cash buyer. If you don’t like one dealer is offering, you can move on to the next.

Features of car loans

How does preapproval affect car loan interest rates?

Preapproval affects car loan interest rates in two ways: It allows you to learn what rate you can qualify for annd use that as a bargaining tool to negotiate a lower rate with a lender.

For example, say you were preapproved for 11% APR. You can walk into a dealership and offer the salesperson 8%. They might come back with 9% or 10%.

Preapproval isn’t a commitment, so if the dealership can give you a lower rate, take it. If you can’t get a better deal, you can walk away or find another dealership that can — or stick with the original loan.

Preapproval vs. prequalifying

When it comes to car loans, preapproval is technically not the same as prequalifying — though some lenders might use the two term to refer to the same process.

Preapproval involves a hard credit check that temporarily lowers your credit score and gives you more power at the dealership. When you’re preapproved, you might even have a check from your lender.
Prequalifying involves a soft credit pull that gives you an estimate of the loan you might get when you apply. It’s helpful when comparing lenders, but it won’t give you leverage for negotiating a price.
  • Tip: If a lender advertises “locked in rates,” they’re talking about preapproval, not prequalifying.

How to get preapproved for a car loan in 5 steps

You can apply for an auto loan online, in person or over the phone, depending on your lender.

  1. Get a copy of your credit score.
  2. Ensure you have all your personal documents and income information.
  3. Compare a range of loans that you can apply for.
  4. Contact your bank or lender you wish to apply with.
  5. Shop around for your next car.

How preapproval works on auto loans

With car loans, preapproval works by allowing you to lock in the rates and terms on a car loan before heading to the dealership. It draws out period between getting approved for a car loan and signing the loan documents.

Unlike preapproval on other types of loans, auto loan preapproval typically requires a full application, documents and a a hard credit check.

What happens after I get preapproved?

After you get preapproved for a car loan, most lenders allow you to shop around for around 30 days to find the right car. Some might offer preapproval for as long as 60 days.

Once preapproved, lenders typically give you a check that you can use to buy a car at a dealership or with a private party. You aren’t obligated to sign off on the loan if you decide to go with another lender or not make the purchase at all.

More features to consider

You can get some of the best features and interest rates on the market with preapproved car loans.

  • Choice of fixed or variable interest rates. Keep your repayments the same each months or take advantage of the flexibility of a variable rate loan.
  • Up to seven-year loan terms. Longer loan terms can help make the regular payments more affordable. Fixed rate loans may only come with maximum loan terms of up to five years. Keep in mind that longer terms lead to more interest paid over time.
  • Weekly, twice a week and monthly payment options. This differs among lenders, but you’ll usually have the choice of when you want to make your loan payments.
  • Extra payments. Some preapproved car loans allow borrowers to make additional repayments without penalty.

Bottom line

Getting preapproved for a car loan can be helpful for buyers who want to negotiate with a dealer or are willing to shop around for a car. But since not all lenders offer preapproval on their car loans, it could limit your options. Check out our guide to car loans to find out more about how auto financing works.

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