car loan application approved

Did you know that around 108 million Americans had auto loans in 2017?

With auto loan debt increasing along with vehicle prices, exploring your car financing options has become even more important. Not only do you want to avoid a hefty monthly payment, but you also want to get the best auto rates.

Like many, you’ve probably figured you’d just apply for your car loan at the dealership. But did you know that you can get a better deal and see other benefits if you check out your prequalify auto loan options beforehand?

Read on to learn why you should get prequalified for a car loan.

1. You’ll Know What You Can Afford

Want to avoid the frustration and heartache of finding out that your dream car costs too much for your budget? Completing the car loan prequalification process can inform you whether you likely qualify for the loan amount needed.

It also provides an opportunity to assess your finances and budget to make sure the new payment will work for your family. For example, you might discover that you need to wait a bit longer and save for a bigger down payment for the vehicle.

2. You Can Get a Better Vehicle Price

You’ve probably heard that paying in cash for an item can help you negotiate a better price. Similarly, having a prequalification gives you more negotiating power when working with the dealership. So, you may end up shaving off a few thousand off the vehicle price.

Depending on the financing company you go through, you may also gain access to special offers and savings like vehicle rebates. Use such offers when comparing your different loan options.

3. You Can Find Better Loan Terms

Getting your auto loan at the dealership can be convenient and allow you to get a long loan term that you may need. But it can also lead to higher interest rates than you can find if you do some work beforehand. 

By prequalifying for a car loan, you can compare loan terms and interest rates and choose the lender that gives you the best deal for repayment. You can also potentially avoid extra fees the dealer may charge.

4. You’ll Save Time at the Dealership

Want to spend most of your time actually looking at cars at the dealership? Then prequalify for an auto loan so that you already have the hard financial stuff done. 

You can simply let the car salesperson know about your prequalification and budget and begin looking for your new set of wheels. You’ll also waste less time negotiating with the dealership.

Explore Your Prequalify Auto Loan Options Today

When you’re ready to research your prequalify auto loan options, start by comparing your choices through banks, credit unions, and even online lenders.

To get started, you’ll need to gather some information for the prequalification process. You’ll need to know your current income, available down payment, and employment contact information. You can often complete your prequalification application online for your convenience and print the results to show the dealership.

Be sure to read our other blog posts about budgeting your money wisely!