Purchasing a vehicle is an involved process mostly due to its price tag. If you are one of the many individuals who expect to apply for a car loan in order to pay for the vehicle of your choice, there are a few documents you will need to have handy. To help the process move smoother, when you are arrive at the car dealership, have these documents with you. Even if you plan on applying for bad credit auto loans, these documents will still need to be presented.
The following are three documents you will need to provide when applying for a car loan.
Driving is a privilege, and for this reason you need to be certified. Your driver’s license is proof that you have been approved to drive in your state of residence. It also helps verify your address and age. In order to apply for a loan, you have to be at least 18 years old because it is the legal age when you can start entering into contracts. You need to ensure that your license is not expired, suspended or revoked. You also want to make sure that the address is up to date.
Proof of Income
When you apply for a car loan, the lender will verify that you have the ability to make your payments. Therefore, proof of income will be requested. A pay stub that is less than 30 days old and shows your year-to-date earnings will suffice. If you are self-employed, your certified tax returns from the last two tax years are acceptable. To be one the safe side, you can supplement your income information with bank statements.
Proof of Insurance
Lenders like to avoid car loan defaults as often as possible. If a car is damaged and then has to be repaired, they know that this could impede your willingness and ability to keep repaying your loan. For these reasons, you will have to provide proof of car insurance, and for liability purposes, you will be asked to procure full vehicle insurance coverage. If you are unsure what vehicle you will be purchasing, you can procure your insurance while the rest of the paperwork is being filled out.
When you apply for a car loan, several documents will be required including a valid driver’s license, proof of income and vehicle insurance.