Auto Loan Documents: A Checklist

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January 27, 2012

Gathering loan documents can be a trying process. If you do not understand the reason for the required documentation, it can be doubly frustrating. Here is a checklist of common documentation required when applying for an auto loan.

Proof of Income

The first thing you will be required to show is proof of income. The lender wants to know that you are gainfully employed and will be able to pay back a loan if they lend money to you.

The lender will likely ask for your two most recent pay stubs. If your employer uses automatic deposit, you will need to provide the receipt of those deposits. Some employers give you a paper copy of the receipts, while others make them available online only. Since you may have no other reason to need that piece of paperwork, it could take a little while to track down your pay stubs.

From these stubs, the lender can see a great deal about your employment history, including how much you've made year to date, how much you pay in taxes, if you have any garnishments from your paycheck, and often, how long you've been employed.

People who are self employed will have to provide at least one year's tax returns, and may need to provide multiple year's tax returns.

Proof of Residence

You may need to confirm with the lender that you do live where you say you live-in other words, that you do have a home where they can contact you and find the vehicle, should you default on payments. This proof may be simply a bill or a driver's license showing your name and the address you gave on the loan application.

Credit History

Although you do not personally provide your credit history, the lender will require that you provide the information they need (full name, social security number and date of birth) so that they can obtain a full credit report from one or more of the credit reporting agencies.

Vehicle Information

Among the loan documents you will need to provide to the lender is a copy of the buyer's agreement or sales agreement from the dealer.

When you first apply for the loan, you may be able to verbally give the vehicle identification number, the make and model, and the mileage and condition of the vehicle, but at closing, the lender will want to see a legally binding agreement stating all of that pertinent information along with the terms of the sale-the purchase price and that the seller is willing to make the deal with you.

If you purchase from a dealer, this is a form they provide. If you purchase from an individual, then you will write up a bill of sale and both will sign.

You will need to obtain the title to the vehicle as well, and the lender will likely take care of adding its name as a lien holder and retaining the title that is issued in your name until you pay off the loan on the car.

Proof of Insurance and License

The lender will need to make sure that the insurance is valid on the vehicle, so they will likely ask for a document showing that the specific vehicle has insurance, not simply that you have an insurance policy with a particular company.

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