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Can I get a car loan from my bank?
I'm in the market for a new car, but I need to finance about $25,000. I know I can get a loan several different places, but I’m happy with my current bank. I’ve banked there since I was a kid and everyone knows me by name. Should I get a car loan from my current bank?
Eric Schad · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
Since you feel like you’re in an episode of Cheers when you enter your bank, no wonder you want to continue to do business with them! If you meet their
car loan
approval qualifications, it shouldn’t be a problem.To qualify for the loan, you will likely need:
- Decent to great credit, depending on your bank’s specifications
- Enough income to support the loan
- A debt-to-income ratio lower than 43%
If you think you meet these requirements, apply for preapproval. The bank will ask for details about your income, debt, and credit and then—if all looks well—approve you for a certain dollar amount and interest rate based on your financial situation.
Once you receive preapproval, you can use the specified loan amount to find a car within your budget. You can even use it as a negotiating tool to get the car you want at a price you can afford (within reason, of course).
Preapproval also gives you an idea of what your monthly payments might be so you ensure you’re comfortable prior to signing on the dotted line. And if you get cold feet, preapproval comes with no obligations. Simply walk away if you decide you don’t want the loan.
But if you choose to move ahead, remember to consider
insurance
when budgeting for your new car expenses. Your bank will require full coverage auto insurance, which may be pricey.That’s when the
Jerry
app can help. As a licensed broker, Jerry helps you find and compare quotes from over 50 top providers in just minutes. When you find a great rate, Jerry helps buy your new coverage and even cancels your old policy!MORE: What to do after buying a new car
View full answer
- Gregory R.
WHY YOU CAN TRUST JERRY
Jerry partners with more than 50 insurance companies, but our content is independently researched, written, and fact-checked by our team of editors and agents. We aren’t paid for reviews or other content.
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