What is a blank-check auto loan? Should I use the full amount?

"I was recently approved for a blank-check auto loan by my bank. I'm not 100% certain what this means, though I think it means I'm approved for up to a certain amount they stipulate. Should I use the full amount?"

Answer
“As you determined, a blank-check auto loan is a pre-approval for a certain amount. This means you can spend every penny up to that amount, but no more than that.
As for how much you should spend, you can certainly spend the whole amount. The idea is that you don’t want the dealership to know how much the blank check is for.
If they find out, be prepared to be upsold for every option, accessory, and extended warranty they have.
Keep tight-lipped, and if you don’t have to spend the entire amount, don’t. You’ll end up saving money on interest in the long run.”
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Eric Schad
Answered on Jul 23, 2021
Eric Schad has been a freelance writer for nearly a decade, as well as an SEO specialist and editor for the past five years. Before getting behind the keyboard, he worked in the finance and music industries (the perfect combo). With a wide array of professional and personal experiences, he’s developed a knack for tone and branding across many different verticals. Away from the computer, Schad is a blues guitar shredder, crazed sports fan, and always down for a spontaneous trip anywhere around the globe.
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