How Long Does Car Finance Take to Get Approved at a Dealership?

Getting approved for car finance is a crucial step when purchasing a vehicle, but you might be wondering: How long does the approval process take? The time it takes to get car finance approval at a dealership can vary depending on several factors, including the type of financing, your financial situation, and the dealership’s process. Understanding what to expect and how to prepare can help you speed up the approval process and get on the road faster.

🏦 The Car Finance Approval Process

The approval process for car finance at a dealership typically involves several steps. Here’s a breakdown of how the process generally works:

💡 How Long Does Each Step Typically Take?

1. Application Submission (10-20 minutes)
   When you apply for car finance at a dealership, the application form typically takes about 10-20 minutes to complete. The form will ask for your personal details, employment status, income, and any other financial information relevant to the loan.

💡 Tip: To save time, have your financial documents ready before applying (e.g., proof of income, bank statements, and driver’s license).

2. Documentation Review (30 minutes - 1 hour)
   After submitting your application, the dealership will review your documents and ensure they are complete and accurate. If you provide all necessary documents upfront, this step can be completed relatively quickly. However, if any documents are missing or incorrect, the process could take longer.

💡 Tip: Double-check that your documents are in order before submitting your application. This will help avoid delays in the approval process.

3. Credit Check (5-10 minutes)
   The dealership will perform a credit check to assess your credit score and credit history. This step typically takes 5-10 minutes if the lender uses an automated system. However, if your credit history is complex or requires manual review, it could take longer.

💡 Tip: If you have good credit, this step should go quickly. If your credit score is lower, expect some additional time for the lender to assess the terms.

4. Loan Approval and Offer (30 minutes - 2 hours)
   Once the dealership has reviewed your application and credit report, they’ll work with the lender to secure loan approval. The time it takes for approval can vary depending on the lender’s process, your financial profile, and the type of financing. For standard loans, this process can take 30 minutes to 2 hours, while specialized loans or loans with higher risks may take longer.

💡 Tip: If you're pre-approved for a loan before visiting the dealership, the approval process will likely be faster.

5. Finalizing the Deal (15-30 minutes)
   Once your loan is approved, you’ll need to finalize the deal. This involves reviewing and signing the loan agreement, as well as completing any necessary paperwork. This step usually takes 15-30 minutes, depending on how quickly you can review and agree to the terms.

💡 Tip: Be sure to read through the loan terms carefully before signing to ensure you understand the interest rates, monthly payments, and repayment schedule.

💡 Factors That Can Speed Up or Delay the Process

Several factors can influence how long it takes to get car finance approval at a dealership. Here are some key factors that can speed up or delay the process:

1. Your Credit Score

💳 Good credit typically results in faster approvals, as lenders can easily assess your risk and offer favorable terms. If you have bad credit, the dealership or lender may need additional time to assess your application or may require a co-signer, which could delay the process.

💡 Tip: If you have bad credit, consider applying for pre-approval to speed up the process and ensure you qualify for financing.

2. Type of Loan

📈 The type of loan you’re applying for also affects the timeline. Standard car loans are generally processed faster than subprime loans or loans for higher-risk buyers. No deposit loans, for example, may take longer to process due to the higher risk to the lender.

💡 Tip: If you’re applying for specialized financing, expect a longer approval process. Standard loans typically take less time.

3. Lender Response Time

🏦 Lenders vary in their response times. Some lenders provide instant approvals, while others may require more time to review your application. If the dealership works with a variety of lenders, the process can be faster, but if the dealership only works with one lender, approval might take longer.

💡 Tip: If you’re in a hurry, consider applying with a dealership that works with multiple lenders to speed up the approval process.

4. Dealership Efficiency

⏱️ The dealership’s internal processes can also affect how quickly you get approved. Some dealerships have streamlined processes with automated systems, allowing them to approve loans quickly. Others may have more paperwork or require manual processing, which can lead to longer approval times.

💡 Tip: Research the dealership’s reputation and reviews to ensure they have efficient approval processes.

💡 Tips to Speed Up the Car Finance Approval Process

If you want to get approved for car finance as quickly as possible, here are a few tips:

1. Pre-Qualify for a Loan

📝 Many lenders offer pre-qualification tools that allow you to check your eligibility for car finance without affecting your credit score. Pre-qualification can speed up the process, as you’ll have a better idea of what financing options are available before visiting the dealership.

💡 Tip: Pre-qualification gives you an edge and helps you avoid delays during the approval process.

2. Have Your Documents Ready

📄 Ensure you have all the required documents ready before applying for finance. Common documents include proof of identity, proof of income, and proof of address. Having these documents on hand can prevent delays and speed up the process.

💡 Tip: Call the dealership ahead of time to confirm which documents are required.

3. Check Your Credit Score

💳 Checking your credit score ahead of time can help you understand what type of loan you might qualify for and what interest rates you can expect. If your credit score is low, you can work on improving it or find a co-signer to help with the approval process.

💡 Tip: If your credit score is low, consider discussing alternative financing options with the dealership.

🔑 Final Thoughts

The time it takes to get car finance approval at a dealership can vary depending on several factors, including your credit score, the type of loan, and the dealership’s process. In general, the approval process can take anywhere from 30 minutes to a few hours. By preparing your documents, understanding your credit situation, and applying for pre-qualification, you can speed up the process and make the experience smoother.

With the right preparation and knowledge, you can get approved for car finance quickly and confidently drive away in your new car.

DISCLAIMER

The information provided on this website is general in nature only and has been prepared without considering your financial needs, circumstances and objectives and should NOT be construed as financial, taxation or legal advice. For more information, get in touch with our experienced partner brokers today.