Should I Apply for Car Loan Pre-Approval?
As part of the car buying process, you’ll typically hone your new car search to a specific model before then applying for finance. All the while, you’ll be left in an uncertain state wondering if the car will still be available by the time you secure finance. Fortunately, however, car loan pre-approvals can help you overcome this uncertainty.
Car loan pre-approval relies on the financier providing its conditional approval for you to buy a car within a certain budget. The lender will take into account your financial position based on the information you supply them. On top of that, as a buyer you are under no obligation to go ahead with the purchase or the loan itself, which is only a pre-emptive step.
It is possible to extend a car loan pre-approval by a month if you need additional time. Just make sure that the vehicle you are considering fits within the conditions set down by the financier as part of their pre-approval.
Extra power to negotiate
Car loan pre-approval gives you extra scope to negotiate the purchase of a new car. At the dealership you will give the impression that you are a ready and willing buyer. In addition to this, your fixed budget also removes much of the tip-toeing around offers and bartering. Seeking finance would generally be a hurdle in any major purchase, so securing this in advance also relieves some of the concerns on the dealer’s part that the deal might collapse.
Scope for a budget
One of the difficult aspects of searching for a new car is not knowing how much you’ll be willing to spend. This might be due to uncertainty over your credit rating, ability to repay the loan or other considerations. However, with car loan pre-approval, buyers establish a set budget they can work with while concluding their negotiations with the dealer.
Simplicity and convenience
The convenience with which a pre-approved car loan helps buyers during the search for a new car cannot be measured. Not only does car loan pre-approval save you time on calculating your budget and conducting negotiations, but you can also rest assured that you are giving yourself the best possible chance to secure the exact car that you wan’t before it’s too late.
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