Lenders always have their own process they use to determine the risk of a loan application and whether to approve or deny it. Most institutions use computer programs that will determine the outcome of loan applications for them. These programs can also determine financing rates. Rates are based on applicant’s credit rating and other information. Most loan applications won’t cross a lender’s desk until it is run through a program and has been approved or denied. Once this occurs, the loan officer will take another look at it to gather any other necessary information that may be needed.

By rule, the lowest auto rates go to people with high credit ratings or who have a lot of money and can afford a big down-payment. Applicants who have poor credit might still be able to acquire a reasonable rate, if they have enough money for a large down-payment or will agree to a different loan amortization. Longer loan periods have higher rates than shorter ones. Educate yourself and do your research before setting out in search of an auto loan. Know what you can do to bring rates down so you can strive to get them.

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