5 Steps to Getting a Captive Finance Company Loan

• Posted on Autos.com Editor
• in Auto Loans
• on October 7, 2013

One option for getting good new or used auto financing is to go through a captive finance company. When looking for car loan options from one of these large, established lenders, there are some general things that a buyer will want to do. Here are 5 steps to successfully arrange a vehicle loan agreement with a captive finance company.

1. Collect Credit Information – Captive finance companies are often most familiar with issuing unsecured, fixed rate auto loans to customers. In these kinds of loan agreements, the customer’s credit score is a key part of what they will pay on the loan, or even whether they will be approved for a specific vehicle loan. That’s why it’s important to get your credit information up front, and fix any problems or errors that could result in rejection of your loan application.
2. Find Out about the Auto Loan Climate – Because a lot of dealership loans can get traced back to offers from captive finance companies, looking at the current policies of these large lenders can show you “which way the wind blows” in a general auto loan market. Knowing more about the current economic climate can help you see your chances of approval for a specific type of loan, according to your credit and current income.
3. Find Local Purchase Options at Dealerships – When seeking a loan from a captive finance company for vehicles from a specific auto maker, it’s a good idea to know where you will eventually be going to buy these cars and trucks. Not all customers choose to visit a dealer’s lot before pursuing auto loan arrangements with a captive finance company, but doing a little research on the Internet can show you what is available in your area, and whether you have the option of going with certified pre-owned vehicles that can carry a manufacturer’s warranty.
4. Use Online Loan Applications – Most captive finance companies, including GMAC, the captive finance company for General Motors, include full-featured online loan applications, where potential car buyers can easily shop online. With your credit and budgeting information in hand, as well as information on your desired vehicle, you can start the process quickly and easily by completing an online loan application and waiting for a response from the captive finance company.
5. Supply Additional Employment and Income Information – It’s a good bet that the captive finance company wants to know more about your financial situation before approving a loan. Include specific income and employment data on your loan application for a better chance of approval.

These are just some of the things that car shoppers go through in order to profit from a car loan from an established captive finance company. Because these companies enjoy a specific relationship with the auto maker, their auto loan quotes can come in handy when you’re collecting all of the options for your most affordable purchase scenarios.