Capital One Auto Finance review: Prequalification process and car shopping made easy

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In a Nutshell

A Capital One Auto Finance loan might be ideal if you’re shopping around and want to see what kind of loan offer you might qualify for without having your credit take a hit. But if you choose to get a Capital One Auto Finance loan, you’ll be limited to buying a car at one of the company’s participating dealerships.

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Pros Cons
Apply for prequalification with no hard credit inquiry You must shop at participating dealers
Search for vehicles online with the Auto Navigator tool You won’t know final loan terms until you apply
Competitive interest rates Minimum monthly income required (depending on your credit)

What you need to know about Capital One Auto Finance loans

Basic car loan options

Capital One offers three common types of auto financing.

  • New-car loan
  • Used-car loan
  • Auto refinance

If you want a private party loan or a loan for a lease buyout, you’ll need to look elsewhere.

You must buy a car from a participating dealer

Capital One Auto Finance loans can only be used to buy a vehicle from one of the company’s participating dealers, though there are thousands available. But if you have a particular dealership in mind that’s not on its list, or limited participating dealers in your area, a Capital One Auto Finance loan may not be the best option for you.

You can apply for prequalification and shop online for a car

Capital One’s Auto Navigator is an online tool that makes it easy to apply for prequalification for a new or used auto loan and search for vehicles within your budget, all in one place.

Capital One Auto Finance completes a soft credit inquiry, then lets you know within minutes if you prequalify. From there, you can use Auto Navigator to search for cars based on a number of factors, such as make, model, mileage and distance from you. In the results, you can see the estimated annual percentage rate, or APR, and payment terms you might get for each car.

If you qualify, you can bring your prequalification offer to your chosen dealer within 30 days to begin the car-buying process. Keep in mind that this offer isn’t a loan approval, so the rate and terms could change.

For a refinance, you can submit a prequalification application online and can typically hear back within 24 hours.

You won’t know final loan terms until you’re at the dealership

Your final loan offer from Capital One Auto Finance may be different from the loan terms you prequalify for. This means your monthly payment could be different from what you expect — but you won’t know until you’re at the dealership and ready to buy a car.

At the dealer, you’ll be required to complete a formal loan application, which could result in one or more hard inquiries on your credit reports. According to Capital One, the dealer looks for financing for you typically by sending your application to multiple financial institutions, including Capital One Auto Finance. If the information you provide the dealership is different from what you provided Capital One Auto Finance to get prequalified, Capital One may offer you different loan terms.

A closer look at Capital One auto loans

Here are some other things to know if you’re considering a Capital One Auto Finance loan.

  • Loans aren’t available in Hawaii or Alaska.
  • Depending on your credit, you need to have a minimum monthly income of $1,500 to $1,800.
  • You may be required to make a down payment.
  • The minimum new or used car loan amount — $4,000 — is lower than some other lenders’ minimums. For a refinance, the minimum is $7,500.
  • You can choose from a range of loan terms — from 24 to 84 months — and additional loan term options may be available through the dealer you choose.
  • The car you choose typically must be a 2009 vehicle or newer and have fewer than 120,000 miles.
  • You can’t use a Capital One Auto Finance loan to buy certain car brands or vehicle types, including Oldsmobile, Daewoo, Saab, Suzuki and Isuzu vehicles as well as commercial vehicles, motorcycles or RVs.

Is a Capital One Auto Finance loan the right fit for you?

If you have a consistent monthly income and don’t mind being limited to participating dealers, Capital One may be a good choice for an auto loan.

It’s possible to get prequalified with a soft credit check. And the Auto Navigator tool can come in handy if you’re on a tight budget. The tool allows you to find cars that meet your preferences and adjust the price, which can help you find a car that fits within your monthly budget.

Another thing to keep in mind is that Capital One’s better APRs are available only to those with strong credit.

How to apply for a loan from Capital One Auto Finance

To apply for prequalification with Capital One Auto Finance, keep in mind that you must plan to use the car for personal use only. You also must be at least 18 years old and have a valid street address within the contiguous United States or an army post office or fleet post office address.

You can apply for prequalification for a new- or used-car loan online, but you’ll need to submit your final loan application at a participating dealer.

Before you submit your final loan application, it’s a good idea to check your credit and compare other loan offers. Understanding your credit can help set expectations — in general, lower credit scores will result in higher interest rates. And shopping around can help you find the best loan rate and terms for your needs. Read our article on how to get a car loan to learn more about the process.

Auto loan alternatives to consider

Capital One makes it easy to navigate the process of applying for prequalification for an auto loan and finding a car at a participating dealership.

But if you’re not sure a Capital One Auto Finance loan is right for you, here are some other options for you to consider.

  • Bank of America auto loan: This lender can be good for someone seeking more loan options, such as a private party or lease buyout loan.
  • Chase auto loan: Chase may be a good option if you want a loan term that’s shorter than 24 months.