Does it Help to Get Pre-qualified for an Auto Loan?

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Are you aware of the advantages of getting prequalified for an auto loan before stepping onto the dealership lot? It helps with determining how much you can afford and could help with dealership negotiations. Camino understands and often communicates these benefits to our members to save them time, money, and the stress of high-interest rates.

Set Realistic Expectations

One reason to get prequalified for an auto loan is to provide an idea of how much you can borrow, which helps you with your budget. This may include costs related to the car, its title, associated taxes, and any additional fees.

Furthermore, getting prequalified means you’ll know what your interest rate and loan terms will be. You can calculate your monthly car payment for even more insight into your budget. Just remember that you aren’t required to apply for your maximum pre-approved amount; in fact, after factoring in all related expenses, it can be a good idea to borrow less if you can. In the end, it’s up to you to determine just how much you can comfortably afford to pay each month for your auto loan.

More Leverage for Negotiations

If you choose not to get prequalified for an auto loan prior to stepping onto a dealership lot, you could end up paying much more than you have to. Plenty of car buyers end up finding the car of their dreams, only to take whatever financing is available out of fear of losing their dream vehicle. If you have been preapproved for a loan, you’ll feel less pressured to have to take dealership financing which could cost have a higher interest rate.

Plus, assuming that you have preapprovals from a number of lenders, you can take the time to choose the best offer for you. This allows for more negotiation power once you’re at the dealership, meaning there’s a chance the dealer could try to beat your lender’s interest rate if they truly want your business.

In summary, you can gain a better understanding of your borrowing limits if you get prequalified for an auto loan alongside more leverage during negotiations if you have offers from multiple lenders. To get prequalified today, reach out to a Member Advisor at Camino, where we’re building bright financial futures through a combination of modern technology and community-aware service to our loyal members.

We invite you to browse our member benefits to see the advantages of joining us as a member. Contact us at (800) 835-3400 to speak with a Member Advisor, or visit us online at caminofcu.org for more information on our offerings.