How It Works
Trust Auto offers financing options for any of our guests who would like to explore the option of financing the vehicle at the dealership. Unfortunately, not everyone can get an auto loan with the length of term, down payment, rate, and monthly payment that they would like, but we can help as much as possible.
There are 3 factors that come into play when it comes to “structuring a deal,” which is a fancy way of saying getting a loan for a vehicle.
Factor 1. The vehicle
Each vehicle tells a different story when it comes to lending money based on that vehicle. Since the vehicle is the security, or collateral, for the loan, then the vehicle’s age, mileage, trim package, and book value all play a part on how the bank sees the “structure” of the deal.
Factor 2. The Person
Every person has a “straw man”, a financial record on file, associated with you, linked by your social security number. That file tells the story of what type of customer you would be to the lending institution. You are assigned a score, which is only a piece of the equation. You are also assigned a risk level, and a report on your file shows the details on loans you have had in the past, as well as other financially relevant information. Lenders take many pieces of that report into consideration, but they also take your current financial situation into consideration. Things like length of employment, monthly income, monthly expenditures, all come into play.
One very common myth is that the score is all that matters, good or bad. This is not true. A low score with a good history of on time payments on auto loans, and good income, with low expenditures, combined with a good down payment, is almost certainly going to qualify you for an auto loan. Whereas a high score, with high expenditures, low income, and too many monthly payments on lines of credit like other loans or credit cards, combined with negative equity from a trade, and no cash down, can really hurt your chances of getting a loan.
Factor 3. The Trade
The vehicle being paid off, and traded in, can play a positive or negative role in the equation. If you owe $5500, but the actual cash value is $4500, then it would take an extra $1000 to complete the transaction, on top of the price of the new car you’re buying. This means your $1000 in the hole, or “upside down”. This is a negative equity situation. It DOES NOT mean you can’t get the loan, it simply means the deal needs to be structured correctly so that you get the lowest rate, and the best payment. That’s why we have professionals in our finance department that know the lender’s guidelines for funding a loan, and can put something together that suits you financially, and gets you the vehicle you need for your situation.
So once you know what you want to do, we help you do it. No pressure, no games, just fun. And we can help you get an auto loan if you want one. That’s how it works;)
What To Bring
If you want to get pre approved for financing, we can help with that. Many of our customers get pre approved, and have already picked out a vehicle before they ever step foot in our building. In that situation, often times we will ask you to bring several documents with you. These documents are required for 2 purposes;
- They help us identify you, and make sure you are the one who is getting financed. This is required so that no one steals someone else’s identity for an auto loan, not on our watch.
- They are required by the lending institutions, in order to verify things like employment, income, residence, and also identity. The lenders won’t be meeting you in person, so they need copies of bills, and pay stubs, to verify the info we send to them on your behalf.
Some banks require as many as 10 references, and 2 forms of ID, plus a written letter from your boss to verify employment and job time. Usually these are good signs, because it means they are giving you a better rate of interest than other banks that don’t do so much verifying. And the verification of the facts reduces risk on the part of the bank, and risk is what raises interest rates. The lower the risk, the lower the rate. So verification, while it can be a pain, is ultimately good for the consumer.