Requirements Needed to Get a Car Loan Approved

These are called stipulations, and the lower your credit score, the more stipulations that will be required.

Let's take a look at what you're expected to provide as part of the loan approval process:

1. Proof of Income
Most lenders require you to submit a current pay stub - no more than 30 days old and showing year-to-date salary totals. In most cases, they will want you to be a full-time W2 employee with a minimum net monthly income requirement of $1,250.

Self-employed borrowers will need to provide at least 90 days of current bank deposit records and up to 5 year's of tax returns.

2. Proof of Residence
Many lenders will require proof of residence, such as a utility bill in the borrower's name mailed to their current address. It cannot be more than 30 days old.

3. Personal References
Lenders like to have a list of references they can contact in the event you don't pay your bills and they're not able to get in touch with you. The lower your credit score, the more references you will have to produce.

Lenders will want as many as 10 references - including full name, address and phone number. If your credit is bad, you can rest assured they will be calling your references so make sure you provide them with real people who will answer their phone.

4. Phone Bill
This is only required if you're a sub-prime borrower. The main purpose is for skip tracing in the event that you stop paying your bills.

5. Car Insurance
Many lenders require that you have full coverage insurance on the vehicle with a deductible of $500 or less. If your credit is good, this won't matter.

6. Driver's License
This should be obvious. You will need a valid driver's license in the state where you reside.