Will you be approved?
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How long does it take to get approved for a car loan?
It can take as little as a few seconds and as long as a few days to get approved for a car loan. How long it takes depends on several factors. These include what type of lender it is, your personal finances and the type of car you’re interested in buying.
How long top providers take to approve a car loan
|Lender||How long is the approval process?|
|Hitachi||Hitachi will make an instant decision on your application and the funds could be in your account within 48 hours.|
|Santander||You can expect a decision on your car loan within 24 hours.|
|Creation||Creation makes an instant decision on your application and the funds can be with you within five working days, following the lender’s receipt of a signed loan agreement.|
|PCF Bank||PCF Bank aims to respond to all applications within an hour and could have funds transferred within two hours.|
|Moneybarn||You’ll receive the results of a soft credit check instantly. If you pass, a member of staff will call to discuss your application on the next working day. You’ll be asked to send documents to confirm your identity and financial situation. Once these are sent, you can expect to receive funds within two to three working days.|
|Amigo Loans||If you complete your application online and all checks are completed without any problems, you can expect to receive funds within 24–48 hours.|
How long does the car loan application process take?
It depends on the lender you choose to apply with, the amount you need to borrow and your creditworthiness. Here’s an idea of how long to expect for each step in the application process:
- Submitting your application. It usually only takes 10–15 minutes to complete an online application. However, if you have to visit a lender’s office to apply in person, it could take longer.
- Immediate response. Some lenders offer instant pre-approval after you submit your application. Those that don’t could take a few days to get back to you.
- Full approval. The turnaround time for full approval differs, as you can see from the table above.
- Loan funding. After receiving full approval from your lender, you can generally expect to receive your funds within one to three business days. However, it’s best to confirm the specific timing with your lender.
How long does it take to get pre-approved for a car loan?
Car loan pre-approval generally takes the same amount of time as getting approved – sometimes a few seconds, sometimes a few days. Car loan pre-approval is a way to lock in rates with a lender before signing the paperwork so you have time to shop around. This gives you the ability to negotiate down your price and determine exactly how much you need to borrow.
Pre-approval generally involves a hard credit check, which briefly lowers your credit score. And you need to submit documents verifying your income, residency and other aspects of your application.
Banks and credit unions tend to take longer than online lenders, while dealerships are often faster than lenders. If you need to provide more documents than usual to verify your identity or income, it could also slow the process down. Buying from a private seller rather than a dealership can also take longer.
What can slow down my application?
If you want to have your loan in hand quickly, avoid these three pitfalls when submitting your application:
Not submitting all required documents
Lenders can only fully approve your loan once all the required documents have been received. If yours is waiting on proof of income or residence, it could hold up your application. To speed up the process, check which documents are required and have them on hand before you apply.
Applying late in the day
Some lenders can offer same-day approval if you apply by a certain time, usually by the end of the business day. If you apply outside of business hours or on the weekend, your application may fall to the back of the queue.
Not providing enough info about your vehicle
This is especially important if you’re purchasing a used car, as some lenders have year and mileage limits. If you’ve already been pre-approved and have found a car, have the dealer send the car’s info to your lender immediately so it can finalise your loan.
Not checking if you qualify
Getting rejected for a car loan can slow down the whole process. Make sure you’re eligible before you apply for a car loan by checking your lender’s minimum income requirements, credit score and vehicle standards.
Other factors to consider when getting a car loan
- APR. Your annual percentage rate (APR) includes both interest and fees. It’s the easiest way to compare the cost of car loans with similar terms.
- Down payment. Lenders generally recommend that you make at least a 20% down payment on your car to offset the cost of financing.
- Loan term. Go for the shortest loan term you can afford to save on interest.
- Availability. Many lenders have restrictions on which cars they’ll work with. Make sure yours can finance that vehicle you’ve had your eye on.
Frequently asked questions
The bottom line
Quick turnaround from a lender means you’ll be in the driver’s seat of your new car faster. Provided you submit all of your documentation and apply during business hours, there are plenty of lenders that can process your application within just a few days.
Want to compare other options? Browse our guide to car loans to learn more about how they work and what else to look for in a lender.
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