It is not always feasible to save up a large sum of money to buy a new car outright. For most individuals, obtaining a car loan is an essential part of the process when purchasing a new or used vehicle. A car loan can assist you in managing your finances more efficiently by spreading out the cost over an extended period. While financing a new car can be a daunting task, it doesn’t have to be complicated.
Getting a car loan has become much simpler with the majority of the application process now available online. So, what are the prerequisites for securing a car loan?
Required application pre-requisites
To comply with anti-fraud legislation in Australia, certain documents are required when applying for a car loan. Typically, the following documents are needed:
- 100 points of identification
- Proof of income
- Proof of assets and liabilities
- Vehicle and vehicle insurance details
The eligibility criteria for a car loan will depend on various factors, including the type of loan and the lender.
Generally, unsecured loans have more stringent requirements compared to secured car loans, especially in terms of credit score.
Lenders usually approve unsecured loans only for individuals with an excellent credit score. On the other hand, lenders tend to be more flexible with secured loan products because the loan is secured against the asset and therefore there is less risk for the lender.
Identification verification
We need generally the following ID and personal information from you when you apply for a car loan:
- Your full name
- Your date of birth
- Your citizenship information
- A list of your dependents
- A copy of your driver’s license
Sometimes, in addition to the standard identification requirements, an alternative form of personal identification such as a Medicare card or passport may be necessary when applying for a car loan depending on your circumstances.
Proof of income
One of the most crucial steps in applying for a car loan is to demonstrate proof of your income to assure lenders that you have capacity and are capable of repaying the loan. Therefore, in most cases we request car finance applicants to submit the following documents as proof of their income:
- Your two most recent payslips
- Your bank statements for the last three months
In some cases, you may be required to submit other documentation such as your most recent Centerlink Income Statement if you receive benefits or your most recent tax return if you are self-employed.
Assets and Liabilities
To obtain a car loan, you must also demonstrate your assets and liabilities to provide a comprehensive overview of your financial situation. The following evidence may be required:
- Information about other loans or debts you have
- Information about other recurring payments or memberships
- Your superannuation summary
Vehicle details and vehicle insurance
To be approved for a car loan in Australia, we require detailed information about the vehicle you intend to purchase. This enables us to determine its value and the amount of your repayments. To facilitate this, you will need to provide us with the following details:
- The vehicle’s registration
- The year, make and model of the car
- The vehicle’s chassis number
- A dealer invoice or contract of sale
- Proof of comprehensive car insurance
How long does the application process take?
After your Finance Consultant receives the necessary supporting documentation from you, they will submit your application to the financier who can provide you with the most suitable finance option.
Typically, we can provide you with an answer and pre-approval on the same day.
How do I apply?
Our online application process and free quoting system make it quick and easy to apply. You can get an obligation-free, instant online quote to estimate your monthly repayments, and one of our friendly Finance Consultants will then contact you to discuss your finance needs.
Alternatively, you can apply online today to start the process and secure your low-rate car finance approval as quickly as possible.
