How Long Does it Take to Get a Car Loan

March 27, 2019

The time it takes to get approved for a car loan really depends. Traditional bank loans are usually the first place borrowers turn, but it can take weeks to get approved and there are often a few hoops to jump through. Thankfully, the car loan landscape has changed. Today, there are trusted online providers that offer near-instant approval...

Almost every vehicle purchased in Canada is financed in some fashion. For those who buy a car at a dealership, two out of every three shoppers chose to pursue car financing at the dealership. The other one-third sought a car loan at a bank or alternative lender. 

While nearly everyone who buys a car needs to borrow money to get the deal done, one common question comes up time and time again: 

“How long does it take to get a car loan?”

The answer depends. You can go through the bank or the dealership...

The credit approval process

No matter if you’re going through a bank or a dealership for your credit approval, the same information is required. 

To obtain a car loan approval, you’ll need: 

  • Proof of employment for a minimum of three months, or a job letter promising employment.
  • Proof of income to support your loan payments and other commitments.
  • ID & proof of residence.
  • Add trade-in vehicle information if you’re looking to trade in your current car. 
  • In some cases, you’ll also need proof of insurance. 

Another major factor is your credit history.

You don’t supply the credit report; you just need to give your consent and the lender will pull that information from one of the major credit bureaus to determine your car loan eligibility.

But while the information required is the same for either a bank or a dealership, the processes are different...

What to expect with bank loan applications

If you decide to finance a car purchase through your bank, you can make an appointment with a loan officer who reviews your application. 

If you opt for auto finance from a bank, there can be a lot of back and forth with paperwork between the bank and dealership.

Altogether, it typically takes two or three appointments over the span of three to seven days or more to get car financing at a bank.

It can take even longer to get approved for a bank loan if your credit is less than stellar. If you have bad credit, the banks will often decline your credit application.

And that’s how Canada Drives can help. We can get you preapproved for a car loan regardless of your credit situation. And we do it QUICKLY. We do everything by phone or email - no appointments required!

Is it faster to use dealership financing?

Car financing at a dealership is a different process to bank loans. Once you find a car you like and reach an agreement with the salesperson, you’ll meet the finance manager who will review your credit score. They’ll submit an application for your car loan to one of several potential lenders. 

In some cases, an approval comes back immediately. In other instances, it can take up to 48 hours. 

Once you’re approved, you sign the paperwork at the dealership and take delivery of your vehicle. With finance arranged at the dealership, there’s no need to run back and forth to a lender. 

Advantages of dealer financing

Compared to bank loans, dealer financing lets you complete your car-shopping experience, financing application, and funding all in one place. In many cases, you could be in the driver’s seat of your new car in as little as 48 hours

Furthermore, with subvented interest rates (the advertised rates you see as low as 0%), customers can save thousands of dollars in interest charges over the course of their loan term, and that’s something a bank can’t offer. 

Keep in mind that your typical bank rate for car loans is higher than advertised rates by car manufacturers. You could pay more interest by financing through your bank over a dealership.

Get a FAST car loan with Canada Drives!

To speed up the time it takes to get a new car, why not get preapproved for auto finance BEFORE you visit the dealership? With a preapproval in your back pocket, you won't waste time looking at vehicles you can't afford! 

Canada Drives is connected to over 350 dealerships that work quickly to get you in the driver's seat!

Whether you have good credit, bad credit, or no credit, you can be preapproved in a few hours and matched with a dealership in your area. Then, all you need to do is visit the dealership, take a test drive, complete the paperwork, and drive away!

It all starts with a simple online questionnaire that takes three minutes to complete, and you could be driving your new car the next day!

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