Typically, finance institutions consider these five important factors when determining your approval and interest rate:
- Credit score: A three-digit summary of your credit report
- Down payment: How much cash you’re willing to pay before the loan
- Term length: The amount of time during which you’ll pay your installments
- Total debt servicing: The monthly payments of your current credit cards, mortgages and installment loans compared to your monthly income
- Vehicle condition: Age, mileage, and cost
- Personal information: The information you enter on your financing application helps lenders assess any risk associated with potential debtors. Lenders place more weight into your expense-to-income and loan-to-income ratios and career length.