If you are shopping for the vehicle before organising your finance then you may be able to complete this last step at the dealership.
But do you need to bring a folder full of documents to apply for your car loan?
These days, the majority of what you need can be sourced and submitted online! Your banking app, copies of your ID, its all very easy now that everything is online.
In this article, we will summarise all that you need to get a car loan at the dealership. There is a lot in there that could be required, but most is not depending on your specific application.
How Dealership Finance Works
Once you have selected the vehicle you would like to buy a dealership will have the option to apply for finance to facilitate the transaction.
This can be organised in a few different ways:
- An on-site business manager who manages the finance applications.
- An on-site finance broker who is a specialist in auto finance (this is the best option!).
- You could be referred to a third party finance broker the dealership has a relationship with.
We always encourage you to deal with an expert finance broker as opposed to a Business Manager.
They will have access to more lenders, will have broader working relationships with those lenders, and deeper finance knowledge to help you get the best result.
Once your application is prepared, and you are placed with the most suitable lender for your circumstances, then the final loan assessment takes place with the lender.
What Do I Need to Apply for Finance at the Dealership
At Gusto Auto, we have our broker team from Gusto Finance in the office and can complete a face to face application at any time.
You will still need to provide some documents but the majority can now be submitted digitally. This makes it quick and easy to package up and send to a lender for a speedy result.
Below I have summarised the types of documents you may need to provide. Our broker will give you a more specific list when preparing your application – usually you won’t need all of these.
If you would like to start a conversation with the team before coming on-site then click the button below to start the process of pre-approval.
This will get you into your new car faster!
Proof of ID
To confirm your identity, lenders require government-issued documents. This ensures that you’re a legitimate applicant and not attempting any type of fraud of identity theft.
The latter may sound silly, but scams are increasing at a frightening speed. So it is a necessary inconvenience to ensure that you do not become the victim of such a scheme.
There are two categories of identification typically required to verify your identity, primary and secondary.
Both carry different weights to satisfy the minimum requirements (usually 100 points of ID) and each lender may have different policies for what is acceptable.
Primary:
- Driver’s license
- Passport
- Birth Certificate
- Citizenship Certificate
- Proof of Age Card
- Immigration Card
Secondary:
- Medicare Card
- Bank Card
- Utility Bill
- Rates Notice
- Student Card
- Employment Document
- Overseas ID
Proof of Income
Your income is the most important factor when determining if you have the capacity to repay the loan.
Generally speaking, you have two categories of applicants here. Those who earn an income, and those who run a business.
The requirements for each will be different.
If you’re employed, recent payslips (usually the last two to three) can be enough.
If your income fluctuates due to bonuses, overtime, or any other type of irregular earnings then you may need to show your annual tax assessment for up to two years.
These are available online via the ATO website.
If you also get income from Centrelink then an income statement to evidence this will be required.
In some cases a lender may want to look closer at your finances. For example, if you have a poor credit history or earn an inconsistent income.
A lender may request 90 days’ worth of bank statements. This will help verify both your income and expenses (which we will get to shortly).
These can be submitted electronically and the dealership can send an SMS to your phone to facilitate the process.
Quick and easy! But usually not required.
ABN holders have the advantage of being eligible for a low-doc loan. The documentation requirements are very low for this category of loan.
We can complete an application with just an ABN registration as long as its over six months. A GST registration can also help as this will show the business turnover exceed the threshold.
Thats it!
For a full-doc application then you could also submit some, or all, of the following:
- Business Activity Statements (BAS)
- Profit and loss statements
- A letter from an accountant
- Business bank statements
- Inventory of other loans and assets of the business
Proof of Address
There are plenty of ways to prove your residential address, so this should be a simple one:
- Utility bills
- Rental agreement
- Bank statement
- Council rate notice
These documents should show your name and current address.
So if you have moved house recently make sure you update these sources as early as possible to prevent delays in the application process while sitting at the dealership.
Credit History and Credit Score
Our broker team will always run a soft credit check at the start of the process so we can quickly understand what lenders will be suitable for your circumstances.
These soft checks do not affect your credit score at all and an official enquiry will not be visible until you make a formal application to the lender,.
Your credit history tells lenders how you’ve managed debts in the past and is one of the most critical factors in assessing you as a credit risk.
Existing Financial Obligations
Transparency with your existing loans and credit card debts is crucial to ensure a smooth loan application at the dealership.
Lenders will already see evidence of these from your credit file and bank statement data (if applicable). But they may also need to verify the data provided.
They could request additional information on:
- Personal Loans: To verify repayments, remaining balance, and loan term.
- Credit Cards: To verify your minimum repayments and credit limit.
This information will help the lender assess how much of your income is left over to make repayments on a new car loan.
If you have other ongoing commitments then also be prepared to disclose these and provide documentation to show the size and duration of your required payments:
- A tax debt to the ATO
- Centrelink debt
- Child support payments
- Unpaid bills that are on a payment plan
Accurately declaring a list of dependents is also an important one.
Vehicle Details
Given that you have already selected the car you are trying to finance, the dealership will take care of this step.
The documentation is required to ensure the car meets the lenders criteria for what can be held as security over the loan. This ensures you are getting the best possible deal on the finance.
Proof of Deposit or Trade-in
The dealership can again take care of this as they will have either provided a receipt for a deposit, or given you a trade-in value that will form part of the transaction.
So nothing to do here when buying through a dealership. But it does make up an important part of your loan application.
Proof of Car Insurance
This is only necessary when the lender includes insurance as a condition of the loan approval.
You may need to show that you have suitable coverage organised before the loan will be settled and you can drive away in your new car.
Residency and Visa Status
If you are new to Australia, or are here temporarily, then it will be more difficult to get a car loan. However, there are a number of lenders who will accommodate a range of scenarios.
Those who are not Australian citizens will need to provide:
- Visa details – the class of visa may determine eligibility
- Length of stay
- Residency proof
- Employment documentation
Permanent residents often face fewer restrictions than temporary visa holders for obvious reasons. If you are on a visa then get in touch with our brokers to discuss your options.
Conclusion
While the list of requirements above are extensive, not all will apply to each car loan application.
If you are dealing with an expert finance broker they will ensure that the burden is minimised as much as possible, and only what is necessary is provided to the lender.
All documents can be provided electronically which makes it much more convenient. You can usually complete this in the dealership office if need be.
This also ensure that approval can be obtained as quickly as possible.
Prior to settlement, all contract signing can also be done electronically. Which makes it much easier to complete all requirements on-site when organising dealer finance.
