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How to apply for a car loan

Choosing an auto loan from a credit union can save you thousands of dollars the next time you purchase a car.


After weeks of research, you’ve found the car of your dreams: cool metallic silver, luxurious heated leather seats, and efficient blind-spot monitoring. Now it’s time to figure out how to pay for it. Most car shoppers can’t foot the five- to six-figure price tag on their own. They need to apply for an auto loan. With a loan, shoppers can finance their purchase by paying back the principal amount with interest over a set period of time.

Applying for a car loan may seem like a daunting process, but it’s actually very simple. We’ve created an easy four-step guide to take with you the next time you apply for a car loan. 

1. Know Your Budget and Credit Score 

The first step before shopping for a car loan is to have an accurate understanding of your financial status, budget, credit history, and credit score. Not sure where to begin? This finance questions checklist will help you get started. 

Knowing your car budget will help you decide how much money to put forward in a down payment. It will also help you understand how much you can afford in monthly payments. But why is knowing your credit score relevant? Your credit score and credit history determine if you qualify for a car loan. 

Lending institutions check your current credit score during the loan process. If your credit score is 661 or higher, you may be offered a competitive loan at a lower interest rate. If it’s lower than 660   you may be denied a loan or offered a high-interest rate loan. If you're a Vibrant member, you can access your credit score and credit report any time by signing up for our free credit monitoring tool. (Car shoppers can also get a free credit report from

Your credit history and past car loan payments will affect your credit score. If you currently have a car loan, be sure you are making on-time payments. This will boost your credit score and may help you get another car loan with favorable rates. If you need a car loan, but are worried you have no credit or will need a cosigner, there are still plenty of options available. Your financial lender can advise you on the best choices.

2. Shop Multiple Lenders 

You spend time researching must-have car features. But did you know you can also research car loans and lenders too? While most car shoppers opt to get a loan at the dealership after they choose a car, researching loan and lender options before car shopping can lead to major savings. If you’re looking to apply for a car loan in Iowa or Illinois, consider visiting a reputable local credit union institution such as Vibrant Credit Union to review their cost-effective auto loan options.  

Car loan lenders: 

  • Car dealerships: Honda, Toyota, etc. 
  • Credit unions: Vibrant Credit Union 
  • National or local banks: Bank of America, Wells Fargo, etc.  

Each loan will have different prerequisites to qualify. The interest rate and payment duration may also vary. 

3. Get Pre-Approved

Pre-approval is the process through which a credit union, bank, or other lender evaluates your financial history and approves you for a potential loan. A pre-approval is not a guarantee you will receive the loan. It’s a confirmation of the maximum money amount the lender is willing to let you borrow. There’re many benefits of getting pre-approved including helping you budget better and giving you more bargaining power at a dealership.  

4. Finalize Your Loan and Strategize Your Payments

The last step is to finalize your car loan and payments. Depending on your budget and your loan, you may want to pay more upfront to decrease your monthly payment amount. Be sure you’re comfortable with the finalized amount and that it won’t stretch your monthly budget too thin. You can also set up automatic recurring debits via your bank account so your payments are always on time.

If you choose to finance your loan with Vibrant, our bankers can process the paperwork while you’re in the car dealership. However, contrary to popular opinion, you don’t need to finalize your loan there. We recommend obtaining a detailed sales quote and scheduling an appointment with your banker to review the offer in a more welcoming, pressure-free environment. 

Working with your Vibrant banker ensures you won’t pay for unnecessary car features or services such as an extra warranty. Once the final purchase price is determined, you can either pay the dealership directly after Vibrant transfers the funds to your bank account or have us send payment directly to the dealership via wire or cashier’s check.  

Apply For a Car Loan With Vibrant Credit Union

We know buying a car can be stressful, but at Vibrant Credit Union, our car loan process is simple and easy. Contact us to discuss car loan options with a knowledgeable banker.  We can’t wait to help you purchase your dream car. 




Q: How long does it take to apply for a car loan at Vibrant Credit Union?

A: Our car loan online application takes fifteen minutes or less to complete. Once the application is submitted, the final decision will be emailed to you within one to two minutes.

Want to submit your application another way? Schedule a virtual or in-person appointment at your local Vibrant Credit Union branch or contact us over the phone to complete the quick three-step application.   

Q: Do I need to submit any personal information when I apply for a car loan?

A: Yes you’ll need to provide the following:

  • Full name 
  • Address 
  • Social security number
  • Employment information 
  • Income
  • Citizenship status

If you’re purchasing a vehicle, you’ll also need to provide: 

  • Vehicle make
  • Vehicle model
  • Model year
  • Mileage
  • Estimated price

If you’re refinancing a vehicle, you’ll need to provide: 

  • VIN #
  • Driver's license
  • Current mileage
  • Estimated resale value
  • Basic income info

Q: Does Vibrant Credit Union charge any fees to apply for a car loan? 

A: No, the application process is free!