Having a good credit score and a sizable down payment are two very important eligibility criteria for auto financing. If you rank poorly in these two areas, the lender will require that you perform well on the third – your debt-to-income ratio.

Fortunately, this final element is completely within your control. Choose a model that you can comfortably afford, and steer away from future financial difficulties.


Nothing is more confusing about automotive financing eligibility and requirements than the pre-approval and pre-qualification processes. The two are very similar, and the industry often incorrectly mixes the two together.

The key differentiator is who initiates the transaction. Things work differently depending on whether the consumer or the lender takes the first step.


Getting a car loan approval with a high credit card balances is possible. Many sub-prime lenders will consider you eligible, but you may not love the terms or interest rate you must pay.

Paying down the balances before buying your car improves your eligibility. Afterwards determining which debt to retire first requires you to weigh pros and cons.


Your credit score is an important eligibility criterion for many different transactions. Taking out new financing for an automobile can either help or hurt your ranking.

Your payment behavior determines the net effect. Expect a temporary dip. What happens next is up to you.


Your ability to verify sufficient income to cover your monthly payment, and validate your employment to ensure continuity are often critical eligibility criteria for an auto loan.

Your credit score is not the only factor that lenders will evaluate. Think about the price of the vehicle and the amount you can make as a down payment.