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How to Get a Car Loan

  • December 7, 2021
  • By Erin Palmer

    Erin Palmer

    Content Marketing Specialist

    Erin Palmer is a content marketing specialist for Suncoast Credit Union. She has written articles for numerous publications and websites, including the Chicago Tribune and Huffington Post. Erin is happiest when curled up with a book, trying a new restaurant or playing with her dogs.

    We’d love to hear your thoughts about the blog! Email us and share what you think.

When you are ready to bring a new car into your life, getting the right car loan is just as important as choosing the right car. Why? Because your auto loan rate impacts how much you pay on your loan over time.

Many people go straight to a car dealership when they’re ready to buy a car. While a dealership can help you find lending options to finance your new car, it makes the car shopping process take longer and may limit your loan options.

Shopping for a car loan first can make car shopping less stressful. This can help you get a low rate, plus it gives you more bargaining power during the price negotiation process at the dealership.

Here is how to get a car loan in seven simple steps:

1. Know Your Credit Score

Woman calculating math meme

Your credit score is a major factor for the auto loan rate you receive. So before you start looking for a loan, take time to learn your credit score. This will help you get a realistic idea of what auto loan rate you might qualify for.

You can request a free credit report from each of the three major credit agencies (Equifax, Experian and TransUnion) once a year. There are also a number of free tools that offer a glimpse into your projected credit score.

A higher credit score could help you get a better auto loan rate. If your credit score is lower, your interest rate might be higher.

2. Find a Low Auto Loan Rate

Dog driving a car 

Once you know your credit score, you’re ready to start looking for the auto loan that is right for you. Look for auto loans with lower interest rates to help you save money over time.

Check the auto loan rates from lenders you trust. Some lenders offer lower rates if you set up automatic payments or might have lower rates for green vehicles, so find out the specific options that are available.

This is also a good time to research GAP coverage, auto repair coverage, or any other additions you might want to protect your purchase.

3. Get Preapproved

Approved gif 

Getting preapproved can make car shopping so much easier. Instead of spending all day at the car dealership waiting to find a lender, provide paperwork, and fill out applications, you can focus on finding the right vehicle for your needs.

Make sure you understand all of the lender requirements, like any restrictions that could impact your vehicle selection or timing for your purchase.

Even if you plan to shop online instead of going to a dealership, preapproval can still help. Because getting pre-approved lets you set your budget and get right to shopping!

4. Set Your Budget

Man saying Mo Money Mo Problems

After getting your preapproved loan, you will know exactly how much you have to spend on your car. This makes it easy to set a realistic budget before shopping.

You can use a car loan calculator to figure out down payment and monthly payment options. Then you can keep your search focused on vehicles in your price range. Once you find the vehicle you want, you can have more negotiating power too!

5. Find Your Car

Oprah saying you get a car, and you get a car

Now the fun part! You can take your budget and use it to find the vehicle that’s right for you. If you’re going to a dealership, you can let the salesperson know about your preapproval to help with the negotiation and selection.

Remember, there are also a ton of car buying tools available to help you shop for a car online. So you can shop for your car whichever way works best for you!

6.Finalize Your Loan

Fry from Futurama saying Take My Money!

When you use your pre-approved offer, make sure to follow any instructions the lender provided during your preapproval. This will complete your loan application process and make your funding official!

7. Keep Making On-Time Payments

Seth Meyers 

Congratulations, you have everything you need to get your car loan! But this final point is still very important: make your car payments on time each month. If you’re ever facing payment difficulties, reach out to your lender to discuss options. 

On-time payment is a major factor in determining your credit score. So once you’ve secured your loan, making timely payments can help build your credit. And since better credit scores can help with better rates, future you will really appreciate the effort!


Car with check mark

Ready to find an auto loan that works for you? We can help!


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