What is a pre-approved car loan?


Quick Answer

A pre-approved car loan means that a buyer has gone through basic approval steps for a loan to buy a vehicle. Lenders pre-approve auto loan applications up to a certain amount, which allows a buyer to go to a dealership with a purchase limit in mind.

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What is a pre-approved car loan?
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Full Answer

With a pre-approved car loan, buyers don't have to deal with the hassle of the dealership's finance manager trying to sell them an auto loan. Pre-approval also saves the buyer time at the dealership. With a pre-approval, the buyer is prepared to focus on the actual sale price in a negotiation rather than the monthly principal and interest payment.

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