If you’re thinking about buying a new car, you’ll need to prepare for your car loan application. And the more you prepare in advance, the smoother the process should be.

To kick-start your application and maximise your chances of getting a great deal, here are a few preparatory steps you should take when applying for motor finance.

The bigger your deposit, the better the deal. If you can put a significant amount down at the beginning of your car loan, you’ll not only need a smaller amount, but you also might get a more favourable APR.

However, don’t panic if you don’t have a large lump sum. With the right broker by your side, you should be able to secure a no-deposit car loan that gets you in a car that meets your needs.

When you apply for car finance, prospective lenders will take a close look at your credit report — so you should do the same. You should be able to obtain a free basic report from the major credit reference agencies:

● Experian

● Equifax

● TransUnion

The higher your credit score, the cheaper your car loan is likely to be. There may be a few quick fixes you can utilise in order to quickly raise your score. Both the credit agency and a motor finance broker should be able to point you in the right direction.

Who wouldn’t want a brand-new Audi Q7? But can you afford the monthly repayments? Being able to secure the finance you need doesn’t mean you should take on a loan your income simply can’t stretch to.

Work out your monthly outgoings and your monthly disposable income. Think about the social life and leisure activities you like to enjoy and factor them into your calculations. If your lifestyle needs to change drastically in order to buy the car of your dreams, you may need to dream a little smaller.

If hire purchase makes your monthly repayments too high, take a look at personal contract purchase (PCP). You’ll have to pay a final balloon payment or return the car at the end of your agreement, but your monthly repayments should be significantly lower. Leasing may also be a more affordable option, but you won’t own the car at the end of the agreement.

Tip: Use a car finance calculator to get an idea of the cars that are likely to suit your budget.

Once you know what your budget will stretch to, you can start looking for cars. But buying a car represents a major investment for most people, so you should be sure you’re getting a vehicle that meets your needs. If you have a large family, an SUV might be a good choice. If fuel economy is your priority, a small hybrid might be the most cost-effective option in the long run.

When you buy a vehicle with motor finance, you need to gather together and present and range of personal information and documentation.

● Basic personal details such as your address and proof of address

● Proof of identity may be required — usually a driving licence or passport

● Proof of income — particularly if your credit score isn’t great

● Employment details

● Bank details

● A debit or credit card to pay your deposit

Finding the best possible car loan for your specific circumstances can be a minefield. But when you have a broker protecting your financial interests, you might be able to save a significant amount of money over the term of your loan.