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304 North Cardinal St.
Dorchester Center, MA 02124
Physical Address
304 North Cardinal St.
Dorchester Center, MA 02124
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Car dealers often simplify the financing process by arranging it for you. However, to maximize your savings and gain more leverage at the dealership, consider getting preapproved for a car loan before you go. Here’s why and how you can do it.
There are two primary ways to secure an auto loan: through a direct loan or dealer-arranged financing.
With a direct loan, you apply directly with an auto lender, usually before visiting the dealership. You’ll provide the lender with information about yourself and the vehicle you wish to purchase, and they’ll offer firm loan terms. Some lenders may even provide a check to take to the dealership.
Alternatively, dealer-arranged financing involves the dealer sending your credit application to multiple potential lenders. While this can help you save money, the dealer may charge a slightly higher interest rate as compensation for finding you a lender.
There are several advantages to getting preapproved for a car loan, even if you don’t end up applying with a direct lender:
Preapproval can impact your credit score. Submitting a full application typically results in a hard inquiry, which can temporarily affect your credit score. However, if a lender sends you a preapproval offer based on a soft credit check, it won’t impact your credit score. Remember, preapproval is different from prequalification, which usually requires less information and doesn’t affect your credit score.
The process for getting preapproved can vary by lender, but generally involves the following steps:
Maintaining good credit habits is crucial for securing low interest rates. Even after approval, staying on top of your credit is important. With Experian’s free credit monitoring service, you can access your Experian credit report and FICO® Score, receive real-time alerts for changes, and spot potential issues like identity theft.
For any mortgage-related needs, call O1ne Mortgage at 213-732-3074. We’re here to help you navigate the process with confidence and ease.
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