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How do I shop for a car if I get a preapproved loan?
I was recently preapproved for a loan, but I have no idea what the next step should be. What do I do to shop for a car and finalize the loan?
Eric Schad · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
Getting preapproval for a
car loan
was a brilliant move. Now the fun of shopping for a car can begin.Make sure to shop around to find the best price and test drive each car you’re interested in. Of course, now that you know your loan amount, don’t entertain any cars above your budget.
Your next step is to negotiate with the dealer. When you negotiate a purchase price, you can mention that you have loan preapproval, but don’t tell them how much it’s for. If you tip your hand, salespeople will try everything in their power to get you to spend the full amount.
Instead, use the preapproval letter as a bargaining tool to get the best price possible. Remember that you don’t have to spend the full amount for which you’re approved. You’ll owe less in the long run.
Before you go back to finalize the loan, shop around for the best insurance rates so you have proof of insurance to show the lender. With the free to download
Jerry
app, you can compare rates from dozens of insurers in minutes to find the best coverage for your needs.View full answer
- Gregory R.
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Jerry partners with more than 50 insurance companies, but our content is independently researched, written, and fact-checked by our team of editors and agents. We aren’t paid for reviews or other content.
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