Car finance – Know the parameters lenders look at

May 19 2010 Before applying for that car loan, you must know the different criteria that the lenders would want to check before sanctioning the loan. That will help you to iron out any irregularity in advance so that the car loan request does not get rejected for any reason.
Some of the common factors the lenders look at are:
a) Proper residential address and tax return filings by the borrower.
b) Credit history of the borrower and whether there are any negative remarks on the report.
c) Whether the borrower has a stable job and his capacity to make repayment of the loan under consideration.
This is not to say that anybody with a bad credit history would not get a loan at all. Lenders would still oblige but would levy a much higher interest rate as compared to somebody with a cleaner credit report.
It becomes the responsibility of the borrower to gradually improve his credit report status and also ensure against any default on the car loan taken so that there are no problems in future and he need not keep paying a high rate of interest.

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