Are you thinking about getting a car loan in Canada? Do you know all the factors that play a huge role in determining whether your car loan will be getting approved or not? Knowing these factors will increase the approval chances of your car loan significantly.
To help you out, we have gathered a handful of potential denial factors that you should be aware of. Check it out.
You have Bad or Limited Credit History
In Canada, if you have less than perfect credit history, your chances of getting a car loan become slim to none. If you have not established your credit history yet, you have to face substantial challenges for getting the car loan.
Most of the time the lenders take into account the credit history of the applicant to judge whether the person is responsible enough to pay back the borrowed money. Unfortunately, no credit history or poor credit history makes a person unreliable to the eyes of the lenders.
However, there are some options for people of this credit category to get a car loan. Applying for loans from the institutions that work with subprime customers can be one option. Signing the loan with a cosigner can be yet another way to make the lender feel comfortable about lending money.
Even though there are many quick fixes of getting a car loan with no or low credit, you should always try to take your credit back on track. A good credit history always means that you have to make lower monthly payments. It will improve the chances of future loan approvals as well.
Your Income Is Irregular
If you have jobs that are not full time, you might face difficulties while applying for car loans online. Here, the irregular income becomes a major factor for getting denied a car loan. Typically, $1800 per month before the taxes is the general requirement of the companies offering car loans. The problem is, everyone cannot afford this type of income.
Most of the traditional lenders deny car loans to the applicants who do not have a stable credit history and good credit score because they become a high-risk factor. So, if you are thinking about getting a car loan and you don’t have a full-time job, saving money for a downpayment is the best way to get a car.
Submitting the Wrong Information
Before approving the car loans, the lender requires you to see all your documents. If you are unable to send the right information or make mistakes while filling out your application form, your chances of getting a loan can get decreased substantially. Submitting the right credential on time is the best and perhaps the most crucial step of getting a speedy and smooth approval from the lenders.
So, these are the simple three factors that you need to keep in mind while applying for a car loan online. If you have a good credit history and have a full-time job, getting a car loan will be like a cakewalk.