Ally Bank is one of the most popular online banks, thanks to its sky-high deposit rates. But it is more than a place to keep your money. The bank also offers loans, including auto financing, though most car buyers will only be able to apply through a dealership. Are Allyâ€™s lending terms as impressive as its deposit accounts? This review will cover all the key details along with how to apply with Ally Bank.
Ally Financial Inc. is one of the largest automotive lenders in the country. Even though its bank is only 10 years old, its history in auto financing goes back a century thanks to its General Motors Acceptance Corp. roots. GMAC was the financing arm of General Motors from the early 1900s leading up to the financial crisis. In 2009, it switched from an industrial loan company into a bank holding company and changed its name to Ally. To this day, General Motors and Fiat Chrysler dealers make up a little more than half of Allyâ€™s auto finance business.
Ally offers loans and leases for both new and used vehicles. However, you donâ€™t apply with Ally directly for auto financing. Instead, you need to visit a local dealership that works with Ally and apply through them.
You can apply for a loan through Clearlane, a subsidiary of Ally. Clearlane does not actually set up auto financing itself but generates offers from lenders from which you can choose. Through Clearlane, you can refinance an existing auto loan or set up a lease buyout if youâ€™re interested in buying a vehicle youâ€™re currently leasing. However, Clearlane doesnâ€™t offer new loans or leases.
Neither Ally Bank nor Clearlane offer many specifics online about their auto loans. Your actual loan terms will depend on the dealership you apply for Ally or the lenders who make you an offer through the Clearlane marketplace.
To apply for Ally auto financing, you first need to find a participating dealership. On the Ally website, you can enter your location and the type of car youâ€™d like to buy/lease, then Ally will give you the names and addresses of nearby dealers that offer its products. You can then decide on the vehicle youâ€™d like to buy and apply for your loan/lease.
The exact application process and requirements will depend on the dealer but expect to submit the typical documents for an auto loan, including:
As part of the application, the dealer could pull up your credit report through a hard inquiry. Since the dealership is setting up your financing, there is no guarantee that it will recommend an Ally loan, especially if the dealer finds a better option.
Ally even suggests that you shop around before visiting a dealership as it acknowledges the benefit of comparing multiple lenders ahead of time.
With Clearlane, you start the application either online or by calling one of its representatives. Theyâ€™ll first ask whether you want to refinance your existing loan or to buy your leased vehicle.
From there, the preapproval application will ask for the details about your existing vehicle (type and mileage), the amount youâ€™d like to borrow, your contact information, income and whether you own or rent your home.
With this basic information, Clearlane will research lenders willing to make you an offer. You do not need to submit your Social Security number, which means Clearlane will not do a hard pull on your credit during this preapproval process.
If you receive an offer that you like, you can formally apply with the actual lender and it will pull your credit. The lender will also ask for the loan documents like proof of income, address and identity. The actual requirements will depend on the lender.
Traditional retail financing â€“ For regular auto loans, Ally offers financing for both new and used vehicles as well as certified pre-owned vehicles that are up to 10 model years old and have no more than 120,000 miles. Allyâ€™s loans also offer specialty vehicle financing to help cover special needs like wheelchair lifts and right-hand drive capability.
SmartLeaseÂ® â€“ Ally also offers leasing for both new and used vehicles but only certain types of used vehicles from a list of approved models found here.
Clearlane refinance â€“ Under the refinance program, you could replace your existing car loan with a new one that potentially has a lower APR and monthly payment. According to Clearlane, its average monthly payment savings for refinance customers is $107/month.
Clearlane lease buyout â€“ With the lease buyout program, you replace your vehicle lease with an auto loan so you can eventually own the vehicle outright.
Clearlane publishes little information about its auto financing products, as it is a marketplace. Vehicle restrictions, terms, payment option and interest rate will all depend on the lender with which youâ€™re matched.
You may encounter an offer from Ally, especially if you buy your next car through General Motors or Fiat Chrysler Automobiles. You may seek out a loan directly through Clearlane if youâ€™re interested in refinancing your current auto loan or buying a car youâ€™re leasing.
With Ally, you need to apply for financing through one of its approved dealerships where the dealer may end up recommending another lender if the terms seem better. This can put you at a negotiating disadvantage â€” itâ€™s always a good idea to walk into the dealership with your own preapproved auto loan. If the dealer can beat with an Ally loan or other offer, great, youâ€™ll know youâ€™re getting the best deal.
While Clearlane lets you compare offers, it only works for refinancing existing loans and lease buybacks.
To research your options even further, you could compare Allyâ€™s rates with those from other lenders offering new and used auto loans. Some of the lowest rates can be found at credit unions, and membership might be easier than you think
There are also several other high-quality auto refinance marketplaces besides Clearlane. If youâ€™ve got an existing auto loan and want better terms, rateGenius is another marketplace that focuses only on loan refinances.
LendingTree, AUTOPAY and iLendingDIRECT are three companies where you can apply online and receive preapproval on quotes for auto loans and loan refinancing. (Note: LendingTree is the parent company of MagnifyMoney.) Whichever marketplace you use, collecting more quotes ahead of time now will help you qualify for better terms on your future auto financing.
The information in this article is accurate as of the date of publishing.
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