What Makes A Successful Car Loan Application?

What Makes A Successful Car Loan Application?

Posted on June 22, 2021

Applying for an auto loan is a serious undertaking but there are straightforward ways of going about it. That’s what today’s post is all about. Our Port Dover auto loan team are going to outline five essential ingredients of a successful car loan application.

By the end of this post, you’ll have everything you need to put together a compelling loan application!

1.   Cash down payment

A down payment on a car isn’t mandatory for a successful car loan application but it does help. It also lowers the amount you’ll need to borrow which benefits you too.

The more you put down, the more you reassure lenders that you’re serious. You’re putting your savings at stake so you’re less likely to default, which lowers your risk.

Lenders hate risk so the more you can mitigate it, the better.

2.   Show your working out

Some lenders have very rigid application processes while others offer a little more freedom for expression.

If the lender you’re approaching is one of the latter, show them your budget. Show them how you worked out you can afford the loan and show them you have taken everything into consideration.

The more you can demonstrate you know what you’re doing, the more likely you are to be approved for the Port Dover auto loan.

3.   Prove everything with paperwork

The lender doesn’t know you. They have no idea who you are or how good you are with money. All they will have to go on is your application and the paperwork you use to support it.

The more complete and the more demonstrative that paperwork is, the better. The more proof of income you have, the better. If you have proof of other income, even better.

Proving you can easily afford the loan with bank statements and paperwork increases the chances of being accepted for the loan.

4. Have realistic expectations

Borrowing too much or being too ambitious with an auto loan are two prime reasons for being refused. Not only will you fail affordability but you’ll also demonstrate you don’t know what you’re doing.

That’s why we have auto loan calculators, loan prequalification and auto loan preapproval. All are mechanisms to show you how much you could reasonably borrow.

4.   Show you have taken responsibility

If you have bad credit or have had credit issues in the past, showing you have accepted responsibility and are doing something about it is key.

Everyone makes mistakes and we can all find ourselves in situations not of our own making. Demonstrating that you have done those things and have taken steps to prevent them happening again can make a huge difference to a loan application.

That could mean coming to arrangements with creditors, paying off debts or closing all unused credit lines. Whatever it takes to demonstrate you take your previous situation seriously and are trying to prevent it happening again.

Nothing will guarantee a successful Port Dover auto loan application but each of these things can improve your chances!

When you’re ready for a car lease or loan, get in touch with the Port Dover auto loan experts at Northway Ford for great deals on auto finance.

Thanks for reading. Be sure to connect with us on Facebook, Twitter, Instagram, or LinkedIn to stay up to date on our latest great articles!