In case you haven’t heard, you can apply for and get an auto loan on the same day. These loans are called same-day or instant auto loans. They’re approved in less than one hour as long as you meet certain requirements. These loans are available at several banks, credit unions, and online lenders.
Usually, the instant loan lender wants to know the exact car you want to buy, whether it’s new or used. In some cases, however, the lender may simply approve a certain amount based on your records.
Pros Of Instant loans
Negotiations: An instant loan gives you more negotiating power with the dealer. You can focus on bringing down the car’s total price or using your instant loan offer to negotiate a better deal with the dealer’s lenders. Since you already have an idea about the rates you can get, you’ll know if the dealer is marking it up.
Time: An instant auto loan can significantly shorten the auto financing process. What could take days or weeks could be done in hours. You could end up driving away in your new or used car fairly quickly.
Affordable: Instant auto loans allow you to figure out how much you can afford before you ever step into a dealership. Once you know your budget, you will be immune to the dealer’s attempts to sell you a more expensive car.
Cons Of Instant Loans
Bad credit: In case you have a poor credit history, then getting an instant auto loan will be difficult. The lender is likely to require more documentation from those with poor credit rather than those with a good credit history.
Scams: You need to be careful with instant loans because there are several companies out there that appear legitimate but are total frauds. Check the lending company in detail before sharing any private information. Indications that the company is fraudulent include upfront fees, insecure website, and no credit check, amongst others.
Hard credit check: Whenever you apply for an instant auto loan, the lender runs a hard credit check. These can lower your credit score. But there’s a way around it. Multiple checks done in a 14-week window are all lumped as one.
