Capital One, a diversified bank that is headquartered in McLean, Virginia, offers financial services to consumers and businesses in the U.S, Canada, and the U.K. It has branches in several states and offers a variety of products including auto loans, credit cards, and home loans.
Capital One offers new- and used-auto financing. The website allows you to pre-qualify, individually or jointly, for a car loan (via the Auto Navigator facility), provided that the vehicle is:
- Priced between $4,000 and $40,000
- A car, truck, SUV, or minivan
- No older than model year 2005 (2007 in certain states) and has less than 120,000 miles
- For personal use only (no commercial vehicles)
- Not on a list of prohibited makes (Oldsmobile, Daewoo, Saab, Suzuki, or Isuzu) nor vehicle types (motorcycles, recreational vehicles, ATVs, boats, camper vans, or motor homes)
- Not a lease buyout, a lemon vehicle, or a vehicle lacking a VIN or issued title
- Sourced from a Capital One participating dealer – you can find a dealer via a link on the Capital One website, which lists about 12,000
To pre-qualify for a Capital One auto loan:
- You must be 18 or older
- Have a valid U.S. or military address
- Have a minimum monthly income of $1,500 to $1,800, depending on your creditworthiness
- If you have any existing Capital One accounts, they must be in good standing (not overdrawn, delinquent, or past due)
Using Auto Navigator will not impact your credit score, and the offered amount is available for 30 days once approved. The Auto Navigator Offer Summary includes APRs, monthly payments, and financing terms for the vehicles that interest you.
You can use the Auto Navigator mobile app to search for vehicles by make, model, condition, body style, and price. You can save search results under Saved Cars.
To use the Auto Navigator at a qualified dealership, first select the car you want and negotiate purchase terms. You can use the mobile app to configure vehicles and compare options while at the dealership. Fill out the dealer’s credit application, a copy of which will go to Capital One. You will then receive an offer from Capital One equal to the pre-qualified terms (given that your information has not changed). If you accept the Capital One offer, simply sign the bank’s Loan Agreement and associated paperwork.
Capital One offers loans on new and used cars. The Capital One website provides a somewhat limited calculator to help you estimate your monthly payments, but calculated results will not necessarily match the pre-qualification offer you receive from Capital One. To use the calculator, enter the vehicle’s condition (new or used), your credit rating (rebuilding, average, or excellent), amount you want to finance, and preferred term length (three to six years). Capital One typically requires you to make a down payment on the vehicle. It advertises its lowest APR, currently 3.24 percent, for borrowers with excellent credit who put down at least 20 percent on vehicles that meet the lender’s requirements for auto loans no greater than five years in length.
Unfortunately, the Capital One website doesn’t reveal many representative rates – you must first fill out the Auto Navigator information before you can receive meaningful information about rates and terms for a new or used car. The website’s fine print does give a representative example: You will pay $500.95 on a 60-month auto loan of $25,000 with $1,000 down and an APR of 7.50 percent.
Capital One offers automobile refinancing currently starting at 3.39 percent APR. To arrange refinancing, you first submit an online pre-qualification application. This step doesn’t impact your credit score. If you pre-qualify, then you fill out a credit application – this will affect your credit score. If you are accepted, you finalize the refinance by providing the vehicle’s VIN and e-signing the auto loan agreement.
Pros and Cons
On the plus side, Capital One’s interest rates appear to be in line with those of its competitors. The Auto Navigator app is helpful when searching for a car that will meet Capital One’s lending requirements. Negatives include a limited amount of participating dealerships and the need to pre-qualify before you can get quotes.