Ways To Help Increase Your Car Loan Approval Odds

Getting your car loan request denied can be quite annoying, especially if you need one. At those times, you might be wondering what did you do wrong – it’s not like getting approved is such a big deal.

If we’re being honest, you’re right, getting approved for a car loan isn’t a big deal and it isn’t that hard, however, it can be problematic if you don’t know how to do it. Getting good rates on your deal is even harder but both of these depend on the same factors such as:

  • Your job status
  • Mishandling essential documentation
  • Bad or low credit score

The reason behind the denial does not matter at this point. Now that you know what are the factors that determine whether or not you’re going to get one and what kind of rates you’re going to end up with, you can focus on improving your odds in the following ways.

Get A Job

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It will be quite hard for you to secure a loan for a vehicle if you don’t have a steady stream of income. It’s not impossible to get a loan if you’re unemployed, but there’s a good chance your request is going to get denied. Even if you do secure a loan, the interest rates might not be worth it. A car loan with a 15% is not a good deal and at that point, you’re just better of using public transport or taxis to get where you need to go.

Therefore, the first step you should take towards securing these funds is to find a job, preferably a well-paying one. Naturally, if you’re self-employed and you run your own business, that will come in handy as well, as long as you can prove to the lender that you have a steady income and you’re a low-risk candidate.

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Check & Fix Your Credit Score

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Now, a job itself sometimes won’t be enough for you to secure a loan. Just because you’re working does not mean you’re responsible with your money, at least in the eyes of lenders.

Before you apply for a loan you need to check your credit score. The credit score is arguably the most important factor in this situation so you’ll want to make sure yours is on point before you apply. You can request a free copy of your credit report from the credit bureau. Once you learn your score, you’ll have a pretty good idea if you can get a loan or not. If your credit score is sub-500, it’s probably best to sit this one out and try and up the score, otherwise, you’re either going to get denied or stuck with an interest rate that’s going to drain your wallet.

Fortunately, even in the events of your credit score being low, there are a few things you can do to help increase it. keep in mind, this won’t be an overnight process and it will take some time for you to pump those numbers up but you’ll get there.

First things first, if you have any outstanding credit card debt – pay it off. according to Franksautocredit.net, no lender in their right mind will give any kind of loan, let alone a good one, to someone that has his credit cards maxed out. Once you clear the debt, or at least on part of it for starters, you’ll see a notable increase in the credit score, which will improve your chances of getting a loan

Next up, you’ll have to pay your bills on time. Missed or late payments leave a really big dirt mark on your credit score, a dirk mark that can last up to seven years. It all comes down to you paying your bills when they’re due and assuring your lender that you will pay them back if they loan the money to you. Naturally, this kind of financial responsibility will also positively impact your credit score.

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Finally, there could be some errors that aren’t your fault but are affecting your credit score. When you get a report, it’s important to comb through it and see if there’s anything out of order. If you happen to notice something that doesn’t sit right with you and you feel like that’s an error – work it out immediately.

Prepare A Substantial Down Payment

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A down payment can be quite a factor when it comes to securing loans and it can greatly impact whether or not you get approved and more importantly it will impact your interest rates. With these kinds of processes, it’s all about balancing the risk. If you’re assuming some of the risks, by offering a down payment, a lender feels more secure to loan you the rest of the money at a more affordable rate.

A down payment should be at least 20% of the total value. That kind of down payment shows the lender that you’re financially responsible and that you just need a little bit of assistance and that’s all. Additionally, if your credit score is low because you’re young and you haven’t had time to increase it – a down payment can also show that you’re responsible and that you can handle your finances.

Find A Consigner

This might be hard, but sometimes you might need to find a consigner in the events that your credit score isn’t high enough for you to secure a loan. A consigner must be someone that guarantees and can pay off the debt in the events that you aren’t able to. As you can see, with the responsibilities they’re assuming, it’s easy to see how this might be hard. Your best bet is your closest friends or family, that is, if you can assure them that you’ll handle everything and their money won’t be in jeopardy and that you just need a little nudge.

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Shop For Lenders

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Finally, just because one of them has turned you down or had offered you a lousy rate, does not mean you’ll get the same rates someplace else. There are many lenders out there and even though it may seem too taxing and time-consuming to go out and knock on every door to try and secure a good loan – sometimes that’s just what you have to do. If you can knock off a few percent of your interest rate it’ll all be worth it, so, feel free to explore your options. The differences might not be all that significant, but you’ll certainly be able to shop for a better deal if you try.


We feel like it’s safe to say that if you work hard enough, you’ll be able to improve your chances of getting a car loan, one way or the other. We’ve shown you a few tested and guaranteed ways to improve your odds. You can try all of them if you want – it certainly won’t hurt. In the end, it all comes down to being financially responsible and showing the lender that you’ll pay them back.