Is this you? You need a car, but you’ve never had to buy one before. At first, it’s exciting! You’re searching around, reading reviews on makes and models, asking family and friends their preferences, and slowly forming an idea of what you want.

But then… it abruptly stops being fun. How do you afford it? What are the best auto loan rates available to you? When do you get your loan? Is your credit even good enough to get a loan?

You’re not alone – Wave Federal Credit Union is here to help you, starting with this guide to your first-time car buyer loan in Rhode Island.

First, get pre-approved.

An auto loan pre-approval can be a powerful tool in your car shopping arsenal – and getting a pre-approved car loan at a credit union is even better thanks to our competitively low rates and special membership benefits.

What is pre-approval? It’s just what it sounds like – it’s what happens before the approval. When you’re approved for a loan, there’s a hard pull on your credit history, and you’re guaranteed a certain dollar amount and interest rate. A pre-approval is the result of a “soft” pull on your credit (so your credit score is unaffected), which allows the lender to quickly provide an estimate of the loan you’d qualify for.

A pre-approval is typically valid for a set amount of time, such as 90 days. It tells you the auto loan interest rate you may qualify for and how much money you may get for your future purchase.

Plus, moving from pre-approval to approval is a fast and easy process. Your loan application is basically already started, so you just finish and submit it, then sit back and wait.

When you are pre-approved for an auto loan, you’ve made the car shopping that much easier for yourself. You’ll be able to step onto the dealership lot with a clear budget in mind, which means it’s also easier to resist a high-end model or all those pricey add-ons you don’t need.

At Wave, you can get pre-approved online in minutes or stop by one of our branches to get personalized guidance. Need an auto loan with bad credit? We can still help you get the lowest auto loan rate possible for your situation.

Next, do your shopping.

Take the time to research the type of vehicle you want, the various yet similar makes and models, and their relative prices.

Once you’ve narrowed down your selections, don’t be afraid to show stubbornness. Buying a car is a negotiation between buyer and seller – the seller is going to want as much of your money as possible, while you want to pay the least amount possible for the car. So don’t automatically agree to any “extras” through the dealership. It’s likely that you don’t need those extras, or your local credit union can get you a better deal on the same thing.

The dealer will also likely try to get you to finance your loan through the dealership. Your pre-approval means you already have a pretty good deal, and often your local credit union can offer you financing that’s better than dealership financing.

Whatever your decision, make sure you do the math, because sometimes a lower monthly payment isn’t actually saving you any money. Check out this example:

This graph is a hypothetical example only and may not reflect your actual experience.

Finally, make your purchase.

Once you and the seller have agreed to a final price, you can either complete your financing at the dealership (if you decide that’s the better deal for you) or return to the lender who pre-approved you to finish your application. At Wave, you can expect a quick turnaround and may even be able to return to the dealership with your money on the same day!

As a credit union with auto loans in Rhode Island, we try to get you not just the best car loan rate possible, but the best deal possible. Wave also offers optional Guaranteed Asset Protection (GAP Insurance) and Credit Life & Disability Insurance at discounted prices – plus, by enrolling in autopay from a Wave checking account to your loan, you automatically get 0.25% off your interest rate. Click here to learn more about our specific auto loan offerings.

Be warned, however, that a pre-approval still doesn’t guarantee approval. While you’re likely to be approved, your application can still be rejected for any number of reasons, such as…

• There’s been a major drop in your credit score since your pre-approval
• The amount of total debt you carry has increased since your pre-approval
• You’ve experienced job loss or a significant reduction in income since your pre-approval
• There is missing or incorrect documentation in your application

We hope this has helped you feel more confident as you start your car-buying journey. If you’re ready to start applying for your auto loan online, go to our online application form. We are here to help you!