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Can you get preapproved for a car loan?
Is there a way to get preapproved for a car loan? It would really help if I could bring a preapproval letter with me to try and negotiate a lower rate with the dealership.
Liz Jenson · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
You’re right! Getting a preapproval letter is a great way to negotiate a lower rate with a dealership. Here’s how you can get preapproved for a
car loan
:- Pick a car or have a general price range in mind. This ensures the lender knows how much you’re looking to finance.
- Gather the documents you need for the loan. Often, this includes proof of identity, proof of income, proof of residence, andproof of insurance.
- Apply for preapproval with several different lenders. Every lender offers different terms and conditions, so you’ll want to find the best lender for you.
- Once you’re approved, your lender will send you a letter stating your preapproval status and the amount you’ll be able to borrow. Then, you can use the letter as leverage for a better deal with the dealership. preapproval only lasts for 60-90 days, so once you receive the letter, you’ll need to act quickly!
That said, when you apply for preapproval, the lender will perform a hard credit check. As long as you apply for preapproval with multiple lenders within 14 days, you shouldn’t see a significant drop in your credit score.
Once you find your car, you’ll also need a new insurance policy. For help finding the best rate on the coverage you need, try
Jerry
. The Jerry app helps users save an average of $879 per year on car insurance! Just download the app, answer some questions, and Jerry will send you personalized quotes from over 50 top providers like Allstate and Nationwide.MORE: How to get a cosigner for a bad credit car loan
View full answer
- Gregory R.
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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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