5 Reasons to Get Pre-approved For an Auto Loan

5 Reasons to Get Pre-approved For an Auto Loan

Shopping for a new car, finding the best deal, and saving extra “bucks” perfectly describes an ideal, car buying-experience. Getting pre-approved for your auto-loan before you begin shopping will help ensure the entire process meets your expectations.

Learn 5 reasons to get pre-approved auto-loans:


Pre-approved loans help save money!


Unfortunately, car-shoppers tend to overlook this money-saving-strategy and its purchase-planning benefits. Dealerships can convince customers into auto-loans with high-interest rates, when chances are, lower or affordable interest rates exists elsewhere. Even if the dealership offers a competitive interest rate, arriving with pre-approved lender rates shifts focus from financing a new car to purchasing a new car.


Pre-approval removes uncertainty and avoids unplanned issues by providing a well-detailed blueprint for budgeting.

          Knowing how much can be afforded.

Why waste time falling in love with a car that is too expensive? A productive dealership-experience includes spending time looking for cars within price-range.

          How much will the monthly loan payment be?

Plug the pre-approved dollar amount into an auto-loan calculator. Factors for determining monthly payment: purchase price, cash rebate, value of your trade-in, amount owed on your trade-in, down payment, annual interest rate, term of loan (months).

Extra Tip: Use a credit unions’ free online calculator for convenience.

         Discover interest rates available.

Getting a feel for how auto-loans work with pre-approved interest rates puts auto-buyers in a strong position before heading to a dealership.


Dealerships’ trustworthiness is slightly tarnished by auto sellers who make over-priced loans, include unnecessary add-ons, and focus on how much a consumer pays monthly. Arriving with a pre-approved amount can lower chances of being bombarded with pricey warranties and services, adding extra fees.

During negotiation—focus on price and trade-in value first!

If a salesperson immediately asks about financing, simply respond: “I’ve been pre-approved.”


A “cash-buyer” is someone who’s not seeking a loan. Once pre-approved, loans act as “cash-on-hand” and strengthens closing the deal. Since you can take pre-approvals to any dealership, the ball is in your court!



Taking care of an auto-loan before heading to a dealership makes purchasing less-complicated and surpasses financial hassles. The entire process can be exhausting—sitting for hours, waiting for decisions, figuring out financing, and more. Pre-approval can turn a half-day dealership visit into an easy, one-hour appointment!


I See Me…How Do You CU?

Access easy, helpful tools at ABECU’s Car-Buying Module  , Budgeting Tool  , and Financial Calculators !

How was your car-buying experience? Tell us your story and share tips below!

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