Is it normal for a car dealer to ask for more money to make a loan go through?
I applied for a loan on a car, but I was denied. However, the dealer said he could make the loan go through if I was willing to put $2,000 more on the down payment. Is this a normal practice? Or is it a scam?
“In all likelihood, it’s not a scam.
You may have been denied by the lender because your debt-to-income ratio is too high or because your credit score isn’t high enough for the amount you’re attempting to finance. Lenders often give dealerships exact reasons why a loan is denied or what conditions are required for approval.
By making an additional down payment of $2,000, you would lower your overall debt and reduce the risk that the lender is taking on. This may be enough to get you approved.
However, be sure to ask the dealer why putting more down will get the loan approved. As long as you’re aware of the situation, you’ll avoid being scammed by the dealer and paying more for the same car.
Don’t forget that when you buy a new vehicle, you will need proper coverage. If you haven’t already found insurance, use the free Jerry app to help you find the best deal. Jerry compares rates from the top 50 companies in under a minute, delivering the best deals to your phone.”
MORE: What is a Car Lien?
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