October 3, 2023

When you apply for a car loan, you should expect approval. Car loans are typically approved far more often than they are rejected. This is because lenders have a lot of data that helps them decide whether or not you’ll repay your loan — and there’s no better predictor of success than how much money you make. But even though you can be sure you’ll find a loan, it’s not always a guarantee. In fact, for more than half of all applicants, it doesn’t work out. So, what do you do when your car loan application gets denied?

1. Improve Your Credit Score

If you’re going to make a lot of decisions in your life based on your credit score, then it makes sense to start by improving yours. Since your credit score is one of the biggest determinants of whether or not you’ll get approved for a loan, being able to improve it could mean the difference between buying that new car and settling.

2. Minimize Your Debts

Debts can hurt your credit score. They can also hurt your chances of getting approved for a car loan. You’ll need to eliminate or pay off all personal debts before applying for a new car loan, so make sure to call your creditors and set up payment plans as early as possible. It would help if you also minimized any debts on your credit report by reporting unpaid debts to the credit bureaus.

3. Contact Poor Credit Lenders

If you’ve had trouble getting approved for a car loan, it’s time to talk to poor credit lenders. These lenders specialize in approving people with bad credit, so they’ll have much more flexibility than your local bank. This also means they’re fast and easy. Plus, there are no penalties if you decide to cancel your loan with them if they can’t approve you.

4. Remove Negative Remarks or Errors From Your Credit Report

If you have been denied a loan or two, and you know it’s because of mistakes on your credit report, you’ll need to contact the appropriate agencies and ask them to fix or remove any negative remarks from your debt report. For example, maybe your address was wrong, or there are delinquent payments that appear that you never paid. Or perhaps there was an error in the reporting of your credit score. Whatever the case, it’s important to fix any errors as soon as possible. 

5. Find Out Why the Loan Was Rejected

When your loan application is rejected, you may want to find out why. The lender may give you a better interest rate or commit to additional procedures. If you’re going to be approved for your loan, then it’s a good idea to ask why the lender denied the loan. This will also help you to improve your chances of being approved in the future.

6. Check Out Another Car Loan Provider

If a particular lender can’t give you approval, then another one may be able to. As with any loan, the best way to ensure you receive the most favorable rate is to shop around for a loan for your next car. Sometimes a change in lender can give you access to better rates and terms. It could help you find the perfect vehicle for your needs.


Credit problems can make it difficult to get approved for a loan, but there are some simple steps you can take to improve your chances. By doing these things, you’ll be well on your way to getting approved for the loan you want.