U.S. Bank Auto Loan Review for 2020

Having a pre-approval letter for an auto loan in hand when you head to the dealership can give you a valuable bargaining advantage. While some loan providers require you to have already found the vehicle you want to buy before applying, U.S. Bank does things differently. With a U.S. Bank auto loan, you can get pre-approved while you’re still shopping for that ideal car. This is just one of the many benefits that U.S. Bank loans offer.

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U.S. Bank was founded in 1863 and has become one of the largest banks in the country. Today, the financial institution offers a variety of services, including credit cards, mortgages, personal loans, and auto loans. Rather than working only with specific dealerships, this bank allows you to apply for financing that you can use at the dealership of your choice. Thinking of buying from a private seller? You can take out an auto loan for a private sale, too.

Car Loan Application Requirements

When you’re ready to apply for a loan, you’ll need the following information:

  • Social Security number or Individual Taxpayer Identification Number
  • Driver’s license, state ID, or military ID
  • Employment information and annual gross income
  • Year, make, model, and estimated value of the car you’ll be buying

U.S. Bank states that applicants should have “good credit,” but there’s no detail provided on a specific minimum credit score. In most cases, you’ll usually enjoy a better interest rate when you have a higher credit rating. If you’re looking for an auto loan that’s ideal for applicants with lower credit scores, a U.S. Bank auto loan probably isn’t the right choice for you.

While you’ll need to provide information about the specific vehicle you’re going to buy when you apply for a loan, U.S. Bank also offers a pre-approval process. This pre-approval option is ideal if you’re still shopping for a car. It can also help you to better understand how much money you’ll be able to finance, and what your monthly payments will look like. With this information, you can focus on vehicles that fit into your monthly budget.

Types of Auto Loans Available Through U.S. Bank

U.S. Bank offers loans for both used and new cars purchased through a dealership or through an individual. Loans start at a minimum of $3,000 and are available to a maximum of $100,000. Loan terms start at 12 months, though you’ll get the best rates with a 36-month term.

In addition to new loans, U.S. Bank also offers refinancing on existing auto loans. By refinancing your loan, you may be eligible for a lower interest rate. This lower interest rate could potentially save you money and reduce your monthly payments, depending on your loan term.

If you’re considering leasing a car, rather than buying, U.S. Bank offers AutoPay to ensure that you never miss a lease payment deadline. You can also sign up for AutoPay with your U.S. Bank loan. Since your payments will be made automatically, in full, and on time, this option can help you to maintain a good credit score and avoid any late payment penalties or fees.

Fees and Rates

At the writing of this article, the U.S. Bank is offering rates starting at 3.59% APR, which are based on a 36-month new and used car loan of at least $10,000. The loan-to-value of the car is 80% or less.

According to U.S. Bank, your loan may incur a higher interest rate if:

  • You’re financing a car that’s more than six years old
  • You want to finance an amount that’s less than $10,000
  • You’re buying a vehicle from a private seller, rather than a dealer

U.S. Bank auto loans also carry many fees:

  • If you don’t set up automatic loan payments from a U.S. Bank account, U.S. Bank will add 0.50% to your loan base rate.
  • If the vehicle you buy is seven to nine years old, your base rate will increase by 1.0%.
  • If you buy a vehicle from a private seller, your base rate will increase by 0.50%.

Additionally, if you pay your loan off early and close it within a year, you’ll face early prepayment fees. These fees are 1% of your original loan amount, with a $50 minimum and $100 maximum.

U.S. Bank Auto Loan Application Process

If you’re still shopping for that perfect car, you can complete a pre-approval with U.S. Bank online. The pre-approval takes about five minutes and you don’t need to provide any details on the car that you’ll be buying. You’ll receive a confirmation letter with your pre-approved loan amount. The process includes a hard inquiry into your credit, which may reduce your credit rating by a few points.

Once you’ve found the vehicle that you’d like to buy, you can apply for a loan online. When you apply during normal business hours, you may receive a response in as little as two hours.

Special Features

With loans starting at just $3,000, U.S. Bank offers auto loans with a lower minimum than you’ll find from many other banks and loan providers. Though the U.S. Bank’s auto loan pre-approval process does involve a hard credit check, it gives you the ability to get a sense of what you can afford. With a pre-approval, you can narrow your focus to cars that you’ll be able to finance. Having a pre-approval letter can also help with bargaining while you shop for a car.

The U.S. Bank loan payment calculator can help you to estimate your monthly payments. You can adjust the term and your loan balance to see which options work best for your budget.

Bottom Line

U.S. Bank offers interest rates that are competitive with other lenders and with the loans that you would get through a car dealership.
A U.S. Bank auto loan may be a good fit for you if you:

  • Have good credit
  • Don’t plan to pay off your loan early
  • Have or are willing to set up a U.S. Bank account to make payments
  • Want to get details on loan rates while still having the flexibility to shop around

You’ll get the best interest rates on a U.S. Bank auto loan if you:

  • Borrow over $10,000
  • Buy from a dealer
  • Repay the loan in 36 months or less
  • Put a down payment on the vehicle

As with any loan, it’s important to carefully read and understand the terms of your U.S. Bank loan. These auto loans do carry some additional fees that can increase your monthly payments. Be sure that you understand the types of loans that will carry the lowest interest rates, and make sure that these loans work well for you.

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