Frequently Asked Questions About Auto Loans And Credit


Have you had your eye on a new Ford car, truck, SUV, or van? Are you curious about how car financing works? Do you have questions about auto loans and your credit? Trust us, you're not the only one. Here at Empire Ford of New Bedford, we help many of our Dartmouth, Acushnet, and Fairhaven MA area drivers with their car financing questions and concerns. Here are a few answers to some of our most frequently asked auto loan and credit questions.

What Does it Mean to Prequalify for a Loan?

It's beneficial to see if you are pre-approved for a car loan before you fully apply. While a prequalification form doesn't guarantee that you'll be approved for a loan, it does help determine if you'll be a good candidate. It will also show our financing team what type of creditworthiness you have. A prequalification form requires your basic financial information, such as annual income, monthly bills, and financial situation.

Why Won't It Affect My Credit Score to Prequalify?

A prequalification form shouldn't require your social security number or a pull on your credit. This means that your credit score won't be affected. Some may need to perform a soft pull, which doesn't show up on your credit.

What Paperwork Will I Need to Get a Loan?

While every lender is different, most used car loans require:

  • Proof of Identity - Driver's license, passport, U.S. visa, or other government-issued I.D. with a photograph and your name.
  • Proof of Income - Pay stubs, bank statements, W-2, verification of employment, etc. 
  • Credit and Banking History - Social Security Number 
  • Proof of Residence - Mortgage statement, utility bill, lease agreement, etc.
  • Proof of Insurance - Insurance card, insurance policy 
  • Trade-In Information - Vehicle information on any trade-in that you may have
  • Method of Down Payment - Check, credit card, debit card, etc.

What is a Co-Applicant and Why Might I Need One?

A co-applicant is someone who has good credit who is willing to apply for a car loan with you. While you're still responsible for the vehicle and its payments, the responsibility will pass to the co-applicant if you default on your loan. Having a co-applicant will show the lender that you're not as risky and help improve your chances of an approval.

Can I Get an Auto Loan Even if I Have Bad Credit?

Yes! While good credit is always beneficial, having bad credit or no credit doesn't mean that you can't get a car loan. There are different programs available for drivers with bad credit and many options available. Talk with a member of the finance department to learn what your options are.

Can I Get a Car Loan After Bankruptcy?

Yes! Bankruptcy is bad for your credit and will negatively impact your credit score for seven to 10 years. This doesn't mean that you won't be able to get a car loan throughout that time, though. There are multiple programs that many lenders offer for drivers who have a bankruptcy on their credit. 

Can I Put Zero Down?

Yes! Most lenders will have no money down loan opportunities available. Of course, the more money you put down, the less money you'll pay for the vehicle in the long run, and the lower your monthly payments will be.

Can a College Student Get a Car Loan Without a Job?

Yes! College students without a job won't be ideal for some lenders, but there are ways to find a car loan opportunity. Fair warning, you'll need either a great co-applicant or a good size down payment.

If I Apply, Does That Hurt My Credit?

Yes and no. The initial car loan application will result in a hard pull on your credit, which will negatively impact your credit score slightly. This negative mark will go away, though, and having a car loan on your credit may actually make your credit score go up.

Contact Empire Ford Of New Bedford With Any Auto Loan Questions

If you still have questions or concerns, we recommend contacting our Empire Ford of New Bedford dealership. Our team of car financing experts would love to help you however we can.