Online Car Loans Compared: Get Approved Before You Shop

Buying a car with cash is stressful enough; finding the right auto loan is even harder. In my car shopping tips from an ex-car salesman, I recommend knowing what you can afford, and getting a pre-approved car loan online before heading to the dealership (even with bad credit). Here’s how, plus reviews of online car loan sites.

Why Get Pre-Approved for a Car Loan Online?

Auto dealers profit on customer ignorance. Walk into a car dealership not knowing you can negotiate and buy a new car at sticker, the dealer makes several thousand dollars. Take a car loan without knowing your credit score and current loan rates, the dealer makes several thousand more dollars! And who paid him? You did!

These two simple steps will save you thousands on your next car loan:

How To Get Auto Loan Approval Online

Most sites offering online car loans allow you to apply for car loans for free and with no obligation. Lenders securely collect loan application information online, including the price range of the vehicle you want, and return a decision and loan terms within a few hours.

If you like the loan, the lender overnights you a check you use to purchase your car. Though your blank check is in hand, your loan is not originated until you use the check. You can use the loan to bargain with dealers, who may beat the online lender’s rate. Decided on dealer financing? Just toss the loan check and drive away.

Pre-Approval Auto Loans Compared

LendingTree is a popular service well known for their mortgage comparison tool, but they also have an auto loan product. Enter your details to get pre-qualified for a car loan (with no obligation) and 4 or 5 banks will compete showing you the best possible rates. All credit levels accepted. Apply now »

For borrowers with good, average and even bad credit, our partner Auto Loan Soup will match you with competing national lenders after you answer just a few quick questions. Apply Now »

Published or updated on June 28, 2008

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Know Before You Go to the Dealership

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About David Weliver

David Weliver is the founding editor of Money Under 30. He's a cited authority on personal finance and the unique money issues we face during our first two decades as adults. He lives in Maine with his wife and two children.


  1. Det Chonchan says:

    Don’t feel it’s necessary to spend the full amount that you’ve been offered.