Can you decline an approved auto loan?



If you apply for a car loan and later decide you don’t want it or like the terms, you can decline the offer. However, once you have signed the documents, you accept the contract and there is no more “refusal” of the loan.

“No thank you, car lender! “

Once you’ve taken your time and energy to apply for a car loan and receive the good news that you’re approved, you don’t have to accept the offer.

Lenders go through an underwriting process where they use your income, work history, credit history, etc., to determine the terms you may qualify for and whether you qualify for a car loan. Once this is done, they send you either a denial or an approval.

If you get the approval and decide that this loan is not for you, you can opt out. As long as you have not signed the loan agreement, you can contact the lender and let them know that you do not accept the offer.

They probably won’t need a full explanation either. You can just tell them that you have changed your mind, or decided not to buy the car, or are looking for a better deal. Some lenders may offer to negotiate terms with you if you make other loan offers that may work in your favor. Who knows, maybe you’ll end up accepting the offer after some good old-fashioned bargaining?

Will refusing a loan offer hurt my credit?

No, turning down an approved car loan offer doesn’t hurt your credit score. If you have decided not to get the loan, nothing more is reported to the credit bureaus.

However, whether you accept or decline the auto loan offer, applying for a loan of any kind can damage your credit score slightly – typically around five to 20 points per thorough application, depending on your current credit score and of your background. However, serious requests only impact your credit score for 12 months.

How about I bring the car home?

If you’ve already accepted a loan offer and taken delivery of a vehicle, you can’t just contact the lender and go back. Once the contracts are signed, they are legally binding.

Getting out of a car loan after childbirth isn’t like returning pants – you have to pay off the loan somehow to end the contract.

Here are some ways to get out of a car loan after delivery:

  • Refinancing – If you like the vehicle, but not the loan, then refinancing might be the way to go. Refinancing involves replacing your old loan with a new one for the same car. The refinance lender pays off your loan (if you qualify), then you start a new loan with them, thus ending your old contract.
  • Sell ​​the car – If you can sell the vehicle for what you owe the lender, this could be an easy way out of a car loan you are not happy with. However, if your car has negative equity, it can be difficult since the value of your vehicle is less than your loan amount.
  • Exchange – Trade-in of your vehicle for its full value does not happen very often, as trade-in values ​​are usually less than a car’s retail value. However, you can find a dealer willing to pay off your car loan and add any negative equity on your next car loan. This is called the negative equity rollover. But beware, this can lead to a large loan amount, higher interest charges, and possibly get stuck in another negative equity situation.

It is not easy to get out of a car loan, especially if you just pulled it off the lot. Before signing the dotted line on a car loan agreement or purchase agreement, make sure you read everything carefully, ask any questions you may have, and keep your cool.

Are you looking for the right connections?

Deciding where to get your next car loan can be stressful. This can be even more complicated for borrowers with less than perfect credit, as many traditional lenders prefer high credit scores. But, here at Auto Express Credit, we want to make it easier to find a lender who works on lower credit through our nationwide dealer network.

Over the past 20 years, we have developed a network of signed dealerships with subprime lenders across the country. Once you’ve completed our free auto loan application form, we’ll immediately get to work finding a special financial dealership that helps bad credit borrowers in your area. Skip the search for a reseller and get started right away!


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