An auto loan broker can provide you with another option to the standard route that many people take to getting a car loan. Many people simply take whatever the dealer gives them for a loan or they give up because they were denied a loan. An auto loan broker could potentially help you in both situations. Here are the basics of what an auto loan broker can do for you.
What Auto Loan Brokers Do
Auto loan brokers typically have many different connections in the lending industry. They are not part of a lending company from any particular lender. They work for themselves, but they have relationships with many lenders. They know about many different loan programs and they get paid for connecting customers with lenders.
Typically, they do not pull your credit file or write up a specific contract for a loan. They may not even be able to speak about specific loan terms until they get offers from lenders. However, they get basic information from you about your credit history, your income, and automobile needs. They then look through their database of loan programs and lenders to match you up. It will then be up to you to fill out your own applications and get approved in most cases. Some brokers may help you with the application process, but not all of them do.
Find the Best Rates
One way that an auto loan broker can help you tremendously is by helping you find the best rates. Since they have relationships with so many different lenders, they have access to the best rates in the industry. When you can get a good interest rate, it will save you money on your monthly payment and it will save you money over the life of the loan. Their connections can sometimes net you a significant savings.
Low Down Payment
Another way that an auto loan broker could potentially help you out is by saving you money on your down payment. Many times, a certain loan will require that you come up with a large down payment to get. By going through an auto loan broker, they may be able to eliminate this problem for you.
Questionable Credit Approval
When using an auto loan broker, you may get approved, even if you were unable to get approved on your own. Auto loan brokers even have access to the sub-prime lending market. Therefore, if your credit is not as good as it should be, sub-prime lenders may still be willing to lend you the money that you need.
Save You Time
One of the biggest ways that auto loan brokers can help is by saving you time. When you have to go out and apply with several different lenders to find a loan, it can take a lot of your personal time. With an auto loan broker, the volume of the relationships that they have in place will significantly decrease the amount of time that it takes you to get a loan.