Hello, my name is Oscar. Welcome to my site about money services. When I first started my job in a new state, I had to lean on payday loans to establish residency and make it through the first pay period. I am thankful for the ability to secure these loans and pay them off in a reasonable time frame. I hope to use my experiences to help other people secure the financial help they need to make it through difficult times. I will explore all of the different money service options in each region. I hope you will visit again soon to learn more.
When purchasing a vehicle, many people prefer to have the automobile financed through a bank or other financial institution. When financing a vehicle through a bank or other lender, a credit report will normally be run to determine if the buyer is eligible for an auto loan. These are some of the different factors that determine if you are approved for an auto loan.
Credit Score And Credit History
Some lenders require customers to have a certain credit score to be approved for a loan. However, they will also look at the customer's credit history as well. This includes the number of loans the person has had before, if their payments were made on time and if they have any outstanding balances that have went into collections.
Lenders may also give consideration to the amount of credit a person has had as well. If the customer has very little or no previous credit to show the likelihood that the auto loan will be paid back as promised, this may prevent approval for the loan. For more information about your car dealer credit report, contact a dealership or lender near you.
Debt To Income Ratio
Another important factor that lenders look at is the customer's debt to income ration. If the customer has several payments to other lenders and this does not leave enough monthly income left over for paying back the auto loan and covering other living expenses, the lender may not approve the loan. Most lenders will not approve a loan that is obviously going to create a financial hardship when the customer is paying it back.
Amount Of Loan And Down Payment
The amount of the loan can also determine if it is approved. The lender will look at the type of vehicle you want to borrow against and determine if the loan amount is reasonable. Lenders also look at the blue book value of the vehicle to get an idea of the maximum amount of a loan that should be borrowed against it.
Most lenders do not approve loans for the full amount of the vehicle purchase price. The buyer is also expected to put down a down payment of his own money to make up for the amount the loan will not cover. For instance, if a loan will only cover 80% of the cost of the vehicle, the buy must pay a down payment of at least 20% or the loan will not be approved.
Loan Term Length
Lenders also consider the term length of the loan. The more quickly they can expect their money to be repaid back, the more likely it is that the loan may be approved. Loans that will not be paid back for several years may not be approved as easily by banks and other financial institutions.
Many lenders provide loans for various reasons, such as home loans, auto loans, debt consolidation and home improvement. If you have lenders you have borrowed from before and have paid back on time, you may have a better chance of getting an auto loan approved by them.
Share9 March 2016
