Why Is a Pre-Approved Auto Loan Better Than a Traditional Loan?

Do you remember the pain of abandoning your dream car because you couldn’t get an auto loan approval? It is hard to let go the dream of buying your favorite car. However, times have changed with the easy availability of a pre-approved auto loan.

With a pre-approved auto loan, you can get a clear picture of the approved loan amount. Also, the lender will give you assurance of paying money as and when required. It means that the loan program will make car buying process a piece of cake for you.

Eligibility Criteria for a Pre-Approved Auto Loan

You need to submit your financial documents to the lender. He will examine your credit ratings and banking activities in detail. After inspecting your financial situation, he will provide you with an approved loan amount for buying a car.

Why opt for a Pre-Approved Auto Loan?

The following points justify why one should opt for a pre-approved auto loan rather than applying for a traditional loan:

· Car Buying Process becomes Clear

After the lender assesses your credit ratings and banking details, you will get a clear idea of the maximum loan amount that he is ready to lend you. It makes choosing a car simple and clear. If your credit ratings are good and the lender approves you for a higher loan amount, you can buy your dream car.

On the other hand, if you apply for a traditional loan, you will have to choose the car first and then apply for an auto loan. And, if your credit ratings are not good, the lender may reject your loan application.

· It saves Time

What if the lender approves for a lower loan amount than you expected? Don’t worry! You can spend time in arranging money for the down payment amount. Applying for a pre-approved auto loan gives you adequate time for taking care of issues such as the down payment amount and the co-signer. Thus, it makes buying your dream car easy. The biggest problem with a traditional loan is that it doesn’t provide you with enough time to make arrangements for the down payment amount. Also, you need to make quick decisions in choosing a co-signer. If you are unable to secure the down payment amount and the co-signer, you will have to abandon your dream of buying a car.

· You can enjoy Low-Interest Rates

Lenders offer low-interest rates to car buyers who apply for a pre-approved auto loan. The reason is that they perform strict scrutiny on financial documents and approve loan application of people with low risk. As they are not worried about their investment, they are able to offer affordable interest rates. If you apply for a traditional loan, the interest rates will be high. It is because the loan program is not designed exclusively for you.

· Luxury of Time

Once you get a pre-approved auto loan, you get an assurance of getting money according to your requirements. Therefore, you can wait for festive offers and enjoy additional benefits or discounts.

On the other hand, approval on a traditional loan requires time. There are chances that you may not be able to enjoy the festive offers and discounts because of the long duration of the loan process.

· Negotiations becomes Easy

Getting a pre-approved auto loan is considered as having money in your hand. The dealer understands it and so, tries to sell you a car as quickly as possible. As you have an upper hand in the negotiation process, you can negotiate with the dealer to buy the car at low price. The negotiations in a traditional loan are not effective as the dealer is aware of the fact that you do not have money to finalize the deal.

· Future Benefits

A pre-approved auto loan, if repaid punctually, also provides future benefits. Applying for loans in the future becomes easy if the lender knows you well. He will provide you with special interest rates and reduce the loan approval time as well. It is because he has reviewed your documents in the past and is well-aware of your financial situation.

When you apply for a pre-approved auto loan, the lender conducts intense research on your banking account and financial transactions. But once the scrutiny is over, you will get a picture of your situation and it will make the car buying process crystal clear to you. So, it is better to apply for a pre-approved auto loan than to spend time on a traditional loan.

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Refinancing Your Car Loan Can Lighten Your Financial Burden

A car can put a smile on your face. But, a terrible car loan has the potential to convert the smile into a frown. If you are not comfortable with your car loan, it will make managing the monthly payments difficult. In such a situation, refinancing your car loan is the right way of putting your worries to rest.

It simply means replacing your existing car loan with a new one and with different terms. The new lender will pay off your current car loan. Also, you will be able to enjoy benefits such as smaller monthly payments and lower interest rates than before. But, before you think about it, there is a lot to learn about refinancing your car loan.

Accurate information is the Key

Refinancing can be a difficult task. It is better to be prepared with the following information beforehand:

· Personal and Contact Information:

Date of birth, social security number, citizenship status, marital status, home address, telephone number and email address.

· Employment and Income Information

Employment status, name of the employer, work-place phone number, total monthly income and other income sources.

· Car’s Information

Manufacture year of the car, VIN number, details of the current car loan and information of the current lender.

The Joy of Refinancing Your Car Loan

Why is refinancing a good idea? Most people see it as a medium to save money. Some people wish to lower their monthly payments. Others opt for it to reduce their interest rates or to adjust their loan terms. There are various reasons to opt it. Before you make a decision, understand its possible outcomes:

· Reduction in Monthly Payments

It will help you in reducing the monthly payments. How? It is possible because the new lender will provide you with better interest rates. As a car buyer, lower monthly payments should be a priority for you because it will have a positive impact on your financial situation.

· Reduction in Interest Rates

If you make timely payments to the current lender, your credit worthiness will improve. And, you will be able to obtain low interest rates while refinancing. It means the total payable amount will reduce due to lower interest rate.

· Reduction in Loan Term

You may consider refinancing the loan with an aim to change your loan term. If you opt for a shorter loan term, the total interest amount will reduce. And, you will be able to save a considerable amount of money.

Refinancing your car loan is worth a try! It will help you to lighten your financial burden. And it will provide you with favorable outcomes in the future as well. So, make a decision of refinancing the loan today and leave your financial worries behind!

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The ABC’s of a Bad Credit Auto Loan: 3 Tips for Getting Loan Approval

Purchasing a new car is an exciting process. You select a car of your favorite color, make and model. But if your credit score does not make the cut, it can create a problem for you. It is will make you realize that a bad credit score is like a ghost that can come to haunt you every now and then. A few late payments, a maxed out credit card and a habit of purchasing in excess than your repayment capacity are a few reasons that can damage your credit score. However, don’t lose heart. Even though you might have suffered from a bad credit score, there are still numerous ways to obtain an approval for a bad credit auto loan.

Do not worry if you want a bad credit auto loan. The following ABC tips will help you in getting loan approval:

Always be Prepared

Prior to applying for an auto loan, ascertain your credit score from your credit reports. Analyzing your credit reports can give you great insight in anticipating any discrepancy or error that may become a problem later. The main factors that are accessed during the process include your current income and your employment stability. Your income will be an indicator of your ability to repay the loan and the duration of your employment will strengthen your credibility in the eyes of the lender. By being prepared, you will be one step ahead in the process of obtaining your bad credit auto loan.

Bring a Strong Co-Signer

A strong co-signer with a flawless credit score can enhance your chances of getting a bad credit auto loan. Once you get a co-signer for your loan, the other person is equally responsible for it. In case, you are unable to repay the loan, the co-signer will be liable to pay the debt. Thus, the presence of a strong co-signer will further create a positive credit image and increase your chances of getting loan approval.

Compare Auto Loan Offers

When starting to look for a bad credit auto loan, it is always a good idea to shop around your neighborhood. Do not take the first deal that is offered to you as it is a wise decision to look for more options. When looking at different lenders, make a note of the ones that offer you the best interest rates. Many a times, bad credit loans include high interest rates. Therefore, it is a good idea to reconsider all your auto loan offers before making a decision.

If you have a bad or damaged credit score, it does not mean that you cannot get loan approval. Remember the ABC tips for obtaining a bad credit loan because they will assist you in getting a faster auto loan approval.

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