When buying a new car, most buyers know how to go about the process – check-out options on websites, visit dealerships, test drive, ask for the best deal, make a decision, and confirm SOLD to the dealer or private seller. But when the purchase requires financing, not all buyers, especially first timers, may know the details of what they need to apply for a car loan and what is needed to get the best finance deal.
Taking on finance is a very important step in buying a new car. Having information about the application requirements and process, may speed up the approval process, may contribute to securing a better interest rate and better finance deal, and in some cases, get the buyer behind the wheel of their new vehicle faster.
Get up to speed on what is required to apply for a personal car loan with this quick guide and use our online resources and personal services for individual assistance with the details.
First Step – Check Your Eligibility
The first step is to ensure you are eligible to apply for personal finance. The personal lending sector, known as Consumer Credit, is regulated through ASIC, the body that sets the guidelines for lenders and applicants. Lenders offering private motor vehicle finance must adhere to these guidelines but may also have additional individual criteria for application approvals.
To be eligible, applicants must:
- Be 18+ years of age.
- Be a permanent resident of Australia or New Zealand or have the correct visa.
- Have a taxable, regular Australian income which can be verified.
- Have a fixed and verifiable home address in Australia.
- Have a credit profile with history and score that can be checked.
Holding a driver’s licence is not an essential requirement. Beyond these essential requirements, lender criteria can include minimum and maximum loan amounts that they will approve, amongst other individual guidelines. The amount approved to individual applicants is the credit limit which is assessed by lenders. Buyers should look for lenders that do approve the loan amount being sought. Individual credit limits will be advised when the lender assesses the application.
Credit Scores and History
Credit scores are critical when applying for any type of finance. Lenders will review credit histories, and some will have minimum scores for application approval. Better credit scores are seen as lower risk and, in general terms, get offered lower interest rates, higher lending limits, and better terms.
Making multiple applications for the same loan to different lenders can damage credit score. These applications are reported and appear on the credit history and can be seen in a negative light by lenders. Avoid this by taking steps to improve credit score prior to application and by using our services to connect you with the most suitable lender.
Tips:
- Check credit score before applying and cleaning up any issues or errors on credit history. See info at Moneysmart for details.
- Improve personal balance sheet by finalising other loans and debts to improve overall credit position which may contribute to a better car loan offer.
Documentation Needed to Apply for a Car Loan
A range of documents and details will be required to complete the application form. Preparing these in advance may speed up the process and ensure faster approval and faster purchase.
Documents and details required include:
- ID with Australian documents such as driver licence, passport, Medicare card, birth certificate and photo.
- Details of liabilities - loans, credit cards, buy-now-pay-later amounts owing.
- Income proof – payslips and documents showing other income sources such as shares and investment properties and allowances from Government sources. Tax returns may be requested.
- Details of expenses incurred on a monthly or regular basis including rent, insurance, utilities etc.
- Bank statements which will verify outgoings and income.
- Details of assets.
And finally, details of the vehicle being purchased will be required.
Collateral and Deposit Required to Apply for Car Loan
Important aspects of motor vehicle finance can be the collateral and deposit required. Most new car buyers will suit a Secured Car Loan which uses the vehicle as the main collateral for the loan. Lenders will assess the application to decide if buyers need to offer additional assets as security.
The amount of deposit needed will depend on the credit limit – if the lender approves the loan amount requested in relation to income and the value of the vehicle. We assist by handling these lender discussions.
Expert Assistance to Apply for a Car Loan
There are a lot of details to consider when applying for car finance. Jade Car Loans experts assist buyers to apply for a car loan by handling the process on their behalf, sourcing the right lender and best interest rates.
Using a broker can be extremely beneficial in quickly connecting with the lender that matches the credit profile and application specifics without impacting the individual’s credit score. Ensuring the best interest rates, best offer, and potentially faster approval and higher lending limits. All with an expert covering off on the details and handling negotiations with lenders on terms, rates and any loan conditions.
All types of buyers of all types of vehicles can use our expert services without a referral required. Our services are fast. Using our experts to get the best car loan will not slow down the buying process. Many applications are approved in 24 hours and with the best interest rates available.
Applications can be submitted via our online systems or over the phone with one of our experts.
Contact Jade Car Loans 1300 000 003 to apply for a car loan and allow our experts to assist you with securing the best finance deal.
DISCLAIMER: IN REGARD TO MISREPRESENTATIONS AND ERRORS CONTAINED IN THE MATERIAL AS PRESENTED, LIABILITY IS NOT ACCEPTED. THE DETAILS AND CONTENT IS PROVIDED FOR CAR BUYERS AND INDIVIDUALS AND BUSINESS SEEKING FINANCE PURELY AS GENERAL INFORMATION. THIS IS NOT PROVIDED AS THE ONLY SOURCE OF FINANCIAL INFORMATION. ANYONE THAT CONSIDERS THAT NEED FINANCIAL ADVICE ABOUT THEIR SPECIFIC REQUIREMENTS SHOULD SEEK THEIR OWN FINANCIAL ADVISOR.
