Every lender varies slightly in their loan requirements. Below are some basic loan requirements you can expect from virtually every lender:
- Government issued identification
- Proof of residency
- Proof of income
- Proof of car insurance
- Be the age of majority in your province or territory
- Consent to a credit rating check
How do you pay off a car loan?
Car loans have set repayment schedules and your payments will be due on a specific date. Payments are usually due every month, but every lender varies. To preserve your credit score, you should always make payments on time and in full. After all, your payment history has the biggest impact on your credit score.
Most lenders prefer to set up pre-authorized payments that come directly out of your bank account when the payment is due. If you wish, you can make a higher payment than what’s due. Higher payments will reduce the term of your car loan and serve as premature interest payments.
What kind of credit score do you need to buy a car?
As a general benchmark, a credit score of at least 650 is required to get approved for an auto loan with ease, but it depends entirely on the lender’s preferences. There’s no set minimum credit score requirement for car loans that are widely known and accepted. Some lenders consider your credit report and credit score during the approval process but also look at other factors such as income.