If you’re looking to buy a new or used car from a dealership, blank check auto loans are a way to get financing without having to use the dealer’s preferred lender. There are a few advantages to using a blank check loan, and the biggest benefit is that the loan’s terms are set before negotiations begin.
When you know exactly how much money you have to spend on a car, you have much more negotiating power- and you are far less likely to end up with a car loan you can’t afford.
Most of the time, first-time car buyers are told that they should go to their bank or credit union to get financed, rather than using the dealer’s lender. Why is this? Banks and credit unions know their borrowers’ histories, and they can often offer better auto loan value to their customers.
It doesn’t matter what kind of credit you have- good or bad. Your bank or other financial institution can also help you repair your credit, so that you have a chance to get the lowest car loan rates.
Now, on to the benefits of the blank check loan
The amount of the loan is already set, so the buyer knows exactly how much they can spend- and they can steer clear of high-pressure sales tactics and remain within budget. A lot of buyers who like to shop around for the best deal will benefit from a blank check loan- they can take the amount they get, and use it as leverage with the dealer.
However, not all lenders are willing to provide blank check auto loans. In fact, most like to know exactly what they’re getting into. If you do find a lender that will work with you, be prepared to provide additional information such as your chosen vehicle’s make, model, year, and maybe even its vehicle identification number.
The lender uses this information to determine whether or not the loan is a good risk for them. If your vehicle is over a certain age or has x amount of miles on the odometer, some lenders won’t even consider you for a blank check auto loan. Usually, you have to have great credit to get car loan approval with a blank check.
How to find good lenders
There are lenders out there that do provide these loans, and it may take some digging to find the right one. The Internet is a great place to start your search- there are companies online that allow people to get quotes from several different sources.
When lenders are competing for your business, it makes it a lot easier for you to find the loan you want at a rate you can afford.
Blank check auto loans are a great way for buyers to bring more bargaining power to the table. If you know what kind of car you want and where you want to get it, then a blank check loan may not be for you.
However, if you aren’t sure what type of vehicle to buy, then it may be worth your while to look into this type of loan.