How Car Loans Work

Qualifying for a car loan depends on many factors, but these are the most important.


Your credit score will give lenders a better understanding of how well you manage your money. A low score means you are not dependable, while a high score means you are financially responsible.


How much money you make each month and how consistant that income is will tell lenders whether they will get their money back. A lack of consistent income will result in a lender not supporting you.


The amount of debt you currently have will indicate whether lenders can trust you with more debt or not. Lenders do not like to lose money, so if your debt is already high, it is likely you will be unable to repay it.

When you qualify for a car loan, it is often not the dealership that provided the loan, but a financial institution such as a bank or other lenders who paid for your car. Your payments must be made to the lender and not the dealer. There will be several dealers who are financially stable enough to do in-house car loans, but this is not common.

Be sure to ask who is providing the loan and be specific on how many lenders you would like to hear from. The dealer could likely run a credit check up to a dozen times during your visit. This will have detrimental effect on your credit score. Though it does come back over time, it will hinder you from qualifying for loans or credit card when you need it most.

NationalCarMatch is partnered with hundreds of dealers and lenders across the State of Texas. Our car matching service ensures we find below-market vehicles matching your criteria. Just CLICK HERE to get started on your free car matching service.

Auto Loan Qualifications

Here, in the State of Texas, you should have 3 to 6 months of employment to show lenders you are able to have a consistent income. You should also be making at least $1,000/m during that time period. Other types of income, such as government assistance programs, allowance, savings and so on may be considered in the decision for your qualification.

You can purchase a car without a driver’s license if you are paying in cash, but you won’t be able to drive it, ensure it or register it in your name without a drive’s license. However, if your matched lender happens to be a bank, your driver’s license will be required.

According to The USA Patriot Act, and reference from PocketSense, “every bank is required to adopt a customer identification program as part of the internal procedures of the bank. Every bank institute must have reasonable measures to establish the identity of a customer, which includes the customer name, address and any other verifying information the bank believes is necessary for identification. The bank is required to ensure that the customer does not appear on any terrorist lists, known or suspected, and to keep proof of identity on record.”

In other words, you’ll need a driver’s license to qualify for a loan by a banker.

A bank account is good to have, because lenders will want to be able to receive payments from your bank account, but it is not entirely required.

Your current address and time of residence will help lenders understand your stability and accountability for the loan. If you are often moving around, it will be difficult to ensure that you will be responsible and not skip town. So having a long standing history at a single and current residency is very helpful for your loan qualification.

This is actually not a requirement, but we want to address this in case you have been told otherwise. A down payment is certainly helpful towards a lender’s decision in giving you a loan, but it is not a requirement. This is where trading an older vehicle or other assets is also a possibility, but still not a requirement. Your qualification will come down to your credit, income, debt and many other minute details.

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No matter what your credit situation is now, our vehicle match program will find the right dealers and lenders that will get you the car you need.  We can arrange for special financing or incentive programs to ensure you pay below market value. Submit your vehicle match application now.


If you have an old vehicle you’re trying to get off your hand, let our experienced professionals find the right buyer for you. No matter the model or condition, we have buyers willing to trade or purchase your car. We can even handle the pick-up of your vehicle. Just submit your vehicle appraisal now.



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