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Auto loan checklist: What you need to apply [Video]

Posted on Tuesday, February 14, 2017 at 11:37:53 AM

Applying for an auto loan isn't all that different than applying for any other loan - particularly in the sense that the more prepared you are, the better off you'll be. To prepare for your application, make sure to have the following:

  • Personal identification. A driver's license or passport are traditionally accepted. Your lender will also need to see proof of a permanent residence. 
  • Proof of income. This can take the form of paystubs from work or a voided check from your employer. If you are self-employed, your lender may want to see this year's tax return. The goal is to show regular and reliable income. 
  • Credit and banking history. Often lenders will pull a credit report to see what other debts you hold and get a broader financial picture.
  • Vehicle information. Your lender will need to get as much information about the car from the seller, whether its a dealership or private individual, including purchase price, vehicle identification number, year, make and model.
  • Proof of insurance. To protect your investment, you will need to show the lender you have an insurance policy for the vehicle. 

While many dealerships have their own financing options, applying for a car loan from an independent lender may often result in a lower interest and better terms.