What information do I provide for a car loan application?
If you need a loan for a car, you’re going to need to gather some specific information about yourself in order to meet your lender's application requirements.
Just a little bit of preparation will make the car loans process quick and smooth for both parties, helping you drive off the lot in a new or used vehicle even faster.
There are some basic requirements everyone applying for a car loan must meet, and we’re going to break down four of the most common below.
Proof of income
Proving that you’re loan worthy means you have to show your lender that you have a steady stream of income. Do this by showing pay stubs from your place of employment or bank statements that show your balance and transactions. Some lenders may wish to call your workplace to verify information.
You can also choose to note any assets you want as collateral to secure the loan but usually, the vehicle itself acts as its own collateral.
You’ll also need to provide some details about the vehicle you’re intending to buy, meaning you’ve already gone to the dealership and gotten an invoice for the car you like. You’ll also need proof of registration ownership, proof of insurance coverage, and if the loan is targeting eco-vehicles, proof of emissions.
Proof of insurance
Before you’re able to take out a loan for your new vehicle, you’ll need to prove you have insurance coverage for it.
You can call an insurance provider from the dealership when you’re ready to buy the car, but having insurance coverage ahead of time is suggested. Shopping around for insurance will help you save money on your premium.
Proof of identity
Unless you’re applying for the car loan at your personal bank, you’ll need to prove your identity to any new lender. Most lending institutions have a point-based identification process where you must provide “100 points of identification”.
This means bringing photo ID, government ID, original utility bills in your name that connect to your current address, bank statements attached to your address, and more.
Proof of residence
You’ll typically be required to prove your place of residence to qualify for a loan. Lenders will want to know where you can be found in case you default on the loan. Recent utility bills provide a good proof of residence.
Having proof of identity, residence, insurance and income are typical requirements when it comes to qualifying for a car loan. Further, providing details on the vehicle you intend to buy ensures you get the proper loan for the right value of the car.
Additional requirements could include your credit report and a down payment.