When you need to purchase a new or used vehicle, instant auto loans are a great way of quickly and easily applying for a car loan. Unlike applying for a Federal Housing Administration loan or a mortgage refinance option on the Internet, applying for an instant auto loan online will usually result in a loan certification of approval within an hour or so—if you have good credit.
If you have poor or marginal credit, you may still be approved but the process could take a day or two. Regardless, instant auto loans are much quicker than traditional bank loans for a car purchase. Refer to this guide to help improve your chances for an approval.
Before applying for an instant auto loan, make sure you have all of the required documentation and information that you will need to eventually forward to the lender. For instance, have copies of your driver’s license, social security card, utility bills and paycheck stubs scanned and ready to email to the lender. If you are self-employed, also be sure to have at least three months’ worth of bank statements ready as well as two or three years of personal income tax returns.
You should get copies of your credit score from the three major credit reporting agencies: Equifax, Experian and TransUnion. Once you get your credit reports, review them carefully. If there are errors or inaccuracies, report them to the agencies and have them deleted or fixed. This will help to increase you credit score, which will give you a better chance of being approved for your instant auto loan.
You can also use your credit reports to identify problems that you can correct yourself. For example, if you have accounts that are currently past due, you should attempt to bring those accounts current before applying for an auto loan. Also, if you have accounts that have very small balances, it will probably improve your credit score to go ahead and pay those off. In short, anything that you can do to reduce the number of accounts that are past due or to reduce the amount of loan balances will help you be approved for an instant car loan.
Knowing what your credit score is will also help you determine which car loan lenders are best for you. There are instant auto loan lenders that cater to people with good or excellent credit and they’re also lenders that specialize in providing “bad credit” car loans to people with past credit problems. You can use your favorite search engine to search for various lenders to determine which lenders offer the types of loan programs that you will need.
When applying for an instant auto loan, a lender will ask how much of a cash down payment you are prepared to make for the car purchase. The more cash you put down on the purchase, the better your chances are of being approved for a car loan. Higher down payments show a greater commitment on your part and also help to make the loan more attractive to the lender. Lenders are far more likely to loan money on a vehicle that is worth more than the amount being financed.