Once the car shopping bug bites, your focus is on finding the car you want and getting it home. Gathering copies of personal records doesn’t exactly heighten the joy of the hunt, but it will be necessary if you intend to get a car loan. This checklist can at least minimize some digging and expedite the process with your lender.
Even if your car loan is from the same place you’ve banked for years, you’ll still need to prove who you are. Prepare to give your Social Security Number (SSN) also, as your driver’s license and Social are two of the main ingredients for generating a credit check.
Proof of address.
Yes, it’s on your driver’s license, but the lender needs to know whether it’s your current address. Grab a recent utility bill for them to confirm if asked. Also, if you’ve been at your address less than a few years, you may have to furnish previous address details.
It’s only fair that a lender have a little information on how you intend to get the money to pay them back. Recent pay stubs and your employer’s contact number will come in handy. If you’re self-employed, this ordinarily means copies of tax returns from the last two years.
After years of general financial shakiness, cosigners are no longer just for first-time buyers or those with sketchy credit. Depending on the car you want and how much you intend to borrow, you may be asked for a cosigner even if your credit is generally good. On the bright side, if you know and are trusted by someone with excellent credit, having them cosign--even if the lender doesn’t require it--may help you land a lower interest rate.
Emergency contact information.
This can be a polite way of the lender asking who they can call to track you down if you miss a payment and don’t answer the phone. Nothing personal, it happens. Even if payments stay current, folks change addresses and phone numbers, but don’t always remember to update the lender if it’s not their primary financial institution.
Car insurance information.
With a car loan, you’re technically proposing the lender buy a car and let you drive it in exchange for payments. They want their investment protected, so they want proof that you are insured. If you do not already have car insurance, they may give you a small window to obtain it or they will secure it with a policy themselves and forward the bill to you.
Whether a dealer or private party, the lender needs this information and will probably contact them prior to loan approval. If you seek pre-approval, you will need to provide seller information as soon as you’ve settled on the car you want.
Again, if you first obtain pre-approval, be prepared to give this information once you find “the one.” Specifics include the vehicle year, make, model and vehicle identification number (VIN). Lenders often have restrictions or different interest rates depending on these details. You might also need to have the lender look over the car to note its general condition and rule out any existing damage. That shouldn’t be too big a bother, since we all like to show off our new cars anyway.