Find the Best Car Loans in Denver, CO

How to get an auto loan in Denver

Many companies provide car loans — it’s a good idea to check with more than one lender before choosing one. Know your budget, the interest rates you qualify for and the various term lengths offered by lenders.

Car loans are available from:

• Banks
• Credit unions
• Online lenders
• Auto dealerships

Most banks, credit unions and online lenders in Denver offer loan pre-approval, which allows you to arrange financing before shopping for a new car. Getting a pre-approval for a loan can be a great benefit that lets you:

• Set a budget before shopping
• Compare several loan offers
• Negotiate for a vehicle as a cash buyer
• Shop for cars at multiple dealerships

Applying for loans with two or three lenders creates competition for your business and lets you choose the loan with the most favorable terms.

What credit score is needed for a car loan in Denver?

Your credit score is a critical factor in qualifying for loans and receiving a low annual percentage rate (APR). New car rates in Denver run from 2 to 5 percent for car buyers with excellent credit. Denver residents with bad credit receive rates that are generally between 12 to 18 percent.

Learning your credit score before applying for loans lets you know what APR you can expect from lenders.

Should I make a down payment?

A down payment can significantly increase your chance to be approved while lowering your APR. Sometimes lenders set a maximum loan amount, so a down payment helps if the amount you need is higher than what the lender approves. A more significant down payment also reduces your monthly payments and the length of your loan.

What loan terms are available in Denver?

Most car loans last between 36 and 60 months, though some lenders offer loans with terms up to 84 months. Extended loan terms lower your monthly payments but increase the overall cost of the loan because of additional accrued interest.

What additionals fees and expenses can I expect?

Expect a few additional fees from your lender or the car dealership, including documentation fees. You also need to pay title and registration fees, state sales tax and insurance costs. Make sure your loan amount is high enough to cover the cost of the car as well as additional upfront costs.

How do I qualify for a car loan with bad credit?

Many online lenders specialize in working with Denver residents who have bad credit or no credit history. Making a more substantial down payment helps you qualify for a loan, but expect to pay a higher APR. If you’re working to improve your credit score and can wait to purchase a vehicle, you can save thousands of dollars.

Having a friend or relative with strong credit co-sign the loan lets you use their credit for a better APR, but your co-signer is responsible for the loan if you default. Most lenders let you refinance your loan after six months to a year if your credit improves and you qualify for a better APR.