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Auto Loan Pre-approval

Why Get a Pre-Approved Auto Loan?

Car financing doesn’t have to be frustrating and time consuming. With pre-approved financing from Nationwide, you finance before you buy, saving you time and money on your next auto loan payment.

Traditional car-buying is, for most of us, a familiar process. We typically begin with a rough idea of what we’re looking for and where we might find it. We visit a few dealerships that stock the models we’re interested in, read a couple of brochures, check out some reviews and make a selection. From there it’s just a matter of a quick price negotiation and some paperwork, right?

If you shop for a car before you’ve investigated financing, you may not be as prepared for your purchase as you think. Automobiles are a major investment, and smart shoppers consider all aspects of the purchase before they buy.

Most dealerships and car lots offer financing, but many car buyers don't realize that these dealerships aren’t just offering financing in-house for your convenience. Car dealers also make money on the financing, and the amount they make increases when they charge a higher interest rate than the one you qualify for. This auto payment calculator can help you estimate what your monthly car loan payment would be at various interest rates and terms.

What is dealer reserve?

Typically, when a car buyer submits a loan application at a dealership, the dealer forwards the application to one or more third-party lenders. If the loan is approved, the lender responds to the dealership with a risk-based “buy-rate” - “the minimum interest rate at which the lender is willing to purchase the retail installment sales contract executed by the consumer for the purchase of the automobile.” - Consumer Financial Protection Bureau

Some third-party lenders allow dealers to mark up the rate charged to the buyer above the buy rate. The lender then pays the dealer a lump sum payment as compensation for the additional interest that the lender will collect over the life of the loan. Lenders refer to these payments as “reserve” or “participation,” and the net result is that the consumer ends up paying a higher interest rate than he or she qualifies for.1

All shoppers understand the importance of trying to find the best possible deal on a car, but many don’t understand the importance of also securing the best possible deal on the financing for the vehicle. With a pre-approved auto loan from Nationwide, you can secure financing before you buy - ensuring that you don’t pay a higher rate than you qualify for. Getting pre-approved for a car loan puts you in the driver’s seat - literally and figuratively. With pre-approved financing, you can show up at the car dealership feeling confident and prepared. Once you’ve negotiated a fair price for a vehicle you like, you’ll be out of the dealership in no time. You can also get your new car insured quickly by getting an insurance quote online.

How to get pre-approved

The first step to getting a pre-approved auto loan is submitting an application. You can access our auto loan online application here.

After you’re pre-approved, we’ll provide simple instructions for finalizing the purchase at the dealership. Your pre-approval will be valid for thirty days, so you have plenty of time to compare vehicles. That’s it! Time to start shopping.

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