4 Requirements For Used Vehicle Financing

If you are currently shopping around for a used vehicle, at a location like Tischer Auto, and are in need of financing, there are some things to think about first. Instead of simply applying for a loan for the first vehicle you find, it helps to be prepared. The following requirements are common amongst most lenders of auto loans for used vehicles. Be sure to have these things before you start applying, as it increases the chances of being approved and helps you qualify for a lower interest rate.

Decent Credit

One of the most important things to have when trying to get an auto loan for a used vehicle is decent credit. While you don't need the very top credit score in order to be approved for financing, it helps to have good credit. Before you start filling out loan applications, request a copy of your credit report and get your current credit score. If there are any mistakes on your credit report, you can get them fixed, which should help your score go up. If you have a low credit score, keep in mind you may need to provide collateral for the loan or get a co-signer.

Stable Employment

Regardless of your credit score, you also need to show that you have sufficient income for paying your loan payment each month. One way to do this is by verifying your employment. If you have paystubs from your current job, bring them in with you when you apply for the loan. If you get direct deposit, you should be able to print your bank statement and show the days you get paid. Also, provide employment information, including what you do and how long you have been employed. This is important when qualifying for a used car loan.

If you are self-employed or own your own business, show your income by bringing in a copy of your most recent tax return or your bank statement.

Permanent Residence

You must also have a permanent residence, which can be verified by providing copies of mail you have received at your home. Some lenders will require you to be at your residence for a certain length of time, while others just want to know where you live and have proof that this is your current, permanent residence. If you have just moved to your home, you may need additional personal references that can verify where you live.

Down Payment

While this isn't always a requirement, it is helpful in many situations. First of all, providing a down payment lowers your overall monthly payments, because you will owe less for the total amount of the loan. It can also help you qualify if you don't have the best credit. Additionally, some dealerships will offer you a lower interest rate if you give them a down payment.