Check Ready Auto Loans: What You Need to Know Before Getting Financing

Buying a car can be an exciting yet daunting process. With so many options for makes, models, features, and prices it’s easy to get overwhelmed. On top of comparing vehicles you also need to think about how you’ll pay for your new ride. Getting approved for an auto loan ahead of time can make the car buying experience much smoother.

One option to consider is a check ready auto loan from PNC Bank. This type of financing allows you to get pre-approved for an auto loan before heading to the dealership. In this article, we’ll explain what check ready auto loans are, their pros and cons, and provide tips for getting the best auto financing.

What is a Check Ready Auto Loan?

A check ready auto loan from PNC Bank provides pre-approved auto financing that you can use at participating car dealers Here’s a quick overview of how it works

• You apply for a pre-approved auto loan from PNC Bank, either online, over the phone, or at a branch. PNC says they’ll provide a lending decision within seconds in most cases.

• If approved, PNC will mail you a paper check overnight that you can use to pay the dealership for your vehicle purchase. This check will be valid for up to 30 days after your loan is approved.

• The check can be used to purchase a new or used vehicle from a licensed U.S. dealer. Only vehicles from model years 2014 through 2023 qualify.

• Loan amounts range from $7,500 to $50,000 with check ready auto financing.

Check ready loans allow you to walk into the dealership with financing already secured. This gives you negotiating leverage since the dealer knows you have an auto loan approval in hand. It also simplifies the buying process because your loan is already taken care of.

Check Ready Loan Pros and Cons

Check ready auto loans offer some nice perks but also have limitations to be aware of Here are the key pros and cons

Pros

• Get pre-approved before shopping so you know your budget
• Gives negotiating leverage with the dealer
• Fast approval process
• 0.25% APR discount for setting up autopay
• No application or prepayment fees

Cons

• Loan amount limits of $7,500 to $50,000
• Can only be used at participating licensed U.S. dealers
• Doesn’t work for private party or lease buyout purchases
• Must go to a PNC branch for other auto loan types

As you can see, the convenience and simplicity of check ready loans come with some restrictions. Make sure this type of financing aligns with your auto loan needs before applying.

What Credit Score is Needed?

PNC Bank doesn’t publish its minimum credit score requirements. But industry experts say you’ll generally need a credit score of at least 660 to qualify for the best auto loan rates.

Applicants with scores in the fair range (580 to 669) may still get approved but should expect to pay higher interest rates. Those with poor credit below 580 will have the toughest time getting affordable auto financing.

Before applying, check your credit reports for errors that could be dragging down your scores. Dispute any inaccuracies with the credit bureaus to boost your approval odds. Maintaining low credit card balances and avoiding new credit inquiries can also help improve your credit profile before applying.

Other Loan Qualifications

In addition to your credit scores, lenders like PNC Bank look at other factors, including:

• Income – Most experts recommend your auto loan payment stay under 15% of your monthly gross income. The more you earn, the larger the loan you can qualify for.

• Existing debt – Lenders will review your debt-to-income ratio, which compares your total monthly debt payments to income. A ratio below 50% is generally preferred.

• Employment history – Steady employment and income sources are important. Having at least two years with your current employer is ideal.

• Down payment – The more you put down, the better. An adequate down payment reduces the amount you have to finance.

Meeting the lender’s income, debt, and employment qualifications in addition to having good credit scores gives you the best shot at getting approved.

What Fees Should You Expect?

A nice feature of PNC check ready loans is they don’t charge origination or application fees. You also won’t incur any prepayment penalties if you pay off your loan early.

However, you’ll still be responsible for paying any taxes, registration fees, and other costs associated with transferring the title when purchasing from a dealer. For a private party purchase, contact your local Department of Motor Vehicles to learn about fees in your state.

How to Get the Best Auto Loan Rates

The interest rate you receive on your auto loan has a major impact on how much you’ll pay over the life of the financing. Follow these tips to help secure the lowest rate possible:

• Have excellent credit – Borrowers with FICO scores above 740 typically get the best rates.

• Pick a shorter loan term – The longer your repayment period, the higher your interest charges. Opt for a 36-month term rather than 60 or 72 months.

• Make a larger down payment – Putting down 20% or more gives you the best rates. Come prepared with at least 10% down.

• Enroll in autopay – Setting up automatic monthly payments from your bank account could score you a 0.25% discount.

• Get pre-approved – Being approved ahead of time gives you leverage to negotiate the interest rate.

• Provide complete documentation – Have all of your financial details handy when applying to speed up the process.

Following these tips can help you land the most competitive interest rate whether you choose a check ready loan or other auto financing. Saving just one percentage point on your APR could equate to over $1,000 in interest savings.

How and Where to Apply

If a check ready auto loan sounds right for your situation, here’s an overview of how and where to submit your application:

Online

You can apply online 24/7 at the PNC Bank website. Make sure to have all of your necessary financial details handy when filling out the application.

Phone

Call 800-762-2118 to speak with a lending representative and apply over the phone. This could be a good option if you need to discuss your unique situation.

In person

Visit your local PNC branch to meet with a banker and complete the application in person. This allows you to ask questions and get personalized assistance.

Dealership

Some car dealerships may allow you to start the pre-approval process onsite as well. But you’ll likely need to provide follow-up verification to PNC Bank.

Whichever method you choose, make sure to have your ID, income details, employment info, and any required documents available to speed up the process. If approved, your check will be mailed overnight so you can head to the dealer ready to buy your new vehicle.

What to Do if You’re Denied

Don’t get too discouraged if your check ready loan application is denied by PNC Bank. Here are some tips for steps to take next:

• Call the lender – PNC is required to disclose the specific reasons for denying your application if you request them. Understanding why will help you improve your chances for future approval.

• Review your credit – Pull your credit reports and check for any negative items dragging your score down. Dispute errors with the credit bureaus.

• Build your credit – If you have limited credit history, take steps like becoming an authorized user on someone else’s account to build your profile.

• Wait and reapply – Give yourself some time to improve your credit or financial situation before applying again.

• Bring a co-signer – Adding a creditworthy co-signer to your application can help offset credit weaknesses when reapplying.

With a combination of patience and a credit-building strategy, you can potentially get approved the next time around. Don’t get too hung up on a denial but rather let it motivate you to improve your borrowing profile.

Alternatives to Check Ready Loans

Check ready financing is just one of many options for getting an auto loan these days. Here are a few other common routes to secure auto financing:

Direct lender – Banks, credit unions, and online lenders all offer auto loans you can apply for directly. This lets you shop rates from multiple providers.

Dealer financing – Many car dealerships have partnerships with lenders to offer financing onsite. But beware of potential hidden fees and higher rates.

Personal loans – Online lenders like SoFi, Lightstream, and Upgrade offer personal installment loans you can use as an alternative to auto financing.

HELOCs – Tapping available funds from a home equity line of credit is a way to access cash for a car if you’re a homeowner.

**Peer-to-peer