What Are the Requirements for a Credit Union Car Loan?
Buying a new car is a major financial decision. When you’re shopping around for one, you’ll want to be able to receive a car loan to make this purchase easier. And the best way to get a car loan is through a credit union. Credit unions usually have lower interest rates than other financial institutions.
Read on to find out what credit union car loan requirements you’ll have to meet. Once you know what you need to do, it will make the whole process quicker and easier so you can get your new car faster.
Be Part of a Credit Union
This one may seem obvious, but in order to get a credit union car loan, you'll need to be a member of the credit union.
The specific requirements for membership will depend on the individual credit unions. Usually, they could include working for a certain company, residing in a certain area, or being a part of specific groups or organizations. Becoming a member of a credit union will have numerous benefits beyond the lower interest rates and fees of their car loans. And it’s usually fairly easy to join. If you’re not already a member, you can apply to become a member of Rivermark Community Credit Union on our website.
Make Sure Your Credit Score Is Good Enough
Another essential requirement for getting a credit union car loan is to have a good credit score. Different credit unions may have different ranges of what scores they consider to be good. Generally, a good credit score is above 640 or 660.
If your credit score isn’t very high, and you don’t need a new car right away, you may want to take some time to try to improve it before applying for a car loan. You can do so by catching up on past-due payments and paying credit card balances.
Also, look over your credit report and make sure there are no inaccuracies. If there are, you’ll want to take care of those ahead of time. This could also increase your credit score.
However, if you really need a car loan sooner rather than later, there may still be a way for the credit union to give you one. You could have someone who does have strong credit cosign your credit union car loan.
The good news is that credit unions are also usually more flexible. This means they’re more willing to work with those who have credit issues than larger financial institutions. Larger financial institutions may also have higher credit score requirements than credit unions.
Proof of a Steady Income
Being able to prove that you’ll be steadily earning income shows that you will be able to make your monthly payments. And in addition to a steady income, you may have to earn at least a certain amount of money per year.
The exact proof of employment you’ll need to show may depend on the credit union. For instance, it could be your pay stubs from the past month or a W-2 form. If you’re self-employed, the credit union may ask for two to five years of tax returns. If you receive Social Security, you may need to include this information with your financial statements as well.
Speak to your credit union ahead of time and ask what documents are required. That way, you’ll already have them ready to go and be able to speed up the process. If you have additional sources of income or additional assets, take proof of those with you as well. Those may help you improve the terms of your loan.
Proof of Identity and Residence
In addition to proof of income, you’ll likely need a government-issued ID and proof of residence. For instance, an up-to-date driver’s license with your current address will cover both of these requirements. You’re more likely to be required to provide this proof if you’re a new member and it’s your first time getting a loan from your credit union. However, if you’ve been a member of the credit union for some time, they’ll likely already have that information. Knowing your residence is necessary in case you don’t make payments and the car must be taken away.
Proof of Car Insurance
Your credit union will want to know for sure that you have adequate coverage. Your insurance must also comply with state laws. If you don’t have insurance already, this is the time to shop around for it.
This may seem obvious, but the applicant, or at least the cosigner, must be at least 18 years old. Having a down payment ready can also help your chances. And keep in mind that once you have the credit union car loan, you’re required to make your payments on time.
Follow this checklist of credit union car loan requirements and you’ll be all set. When you get a loan from Rivermark Community Credit Union, we’ll offer low fixed rates, no application or loan fees, and a quick and easy application process. Plus, you’ll find our service much more personable than you would at larger financial institutions. If you have any additional questions, we’re here to help. You can find our contact information and more on the Rivermark website. You can also find out more about our special Express Auto Loan and even apply online. Before you know it, you’ll be driving in your new car.
Have Questions About Auto Loans?
Our auto loan resources page can help you make informed decisions as you prepare to shop for a car or apply for an auto loan. And, as always, you can call Rivermark and speak directly to a lending expert by calling 503.626.6600.