Does this require vehicle verification or valuation?

When applying for a loan for a used car, often the car will be verified and a valuation provided. Lenders want to determine that the actual car you are buying is the car the seller claims to sell, and it is valued at the price you paid for it. This means that they will check the condition of the car, its history as well as the market value before they give you the loan.

Verification essentially only verifies that the documentation about the car is authentic. Lenders verify the registration certificate (RC), the insurance papers and sometimes the accident or service history of the vehicle. They might also check the database called VAHAN, which will tell them the ownership of the vehicle is indeed correct, as well as if there are any outstanding loans or legal disputes relating to the vehicle. Doing these assessments will help prevent fraud and ensure that you do not purchase a vehicle with issues or deficiencies that are hidden.

Valuation is an important aspect. Lenders will usually either send an agent to inspect the car, or request that the financing applicant arrange for a professional valuation. The inspector will check the car both inside and outside, looking for dents, excessive rust, the condition of the engine, and the overall wear and tear.

You may be charged for the inspection and valuation, either as a separate charge, or as part of the processing charges. Ultimately, the whole verification and valuation procedures are designed for the protection of both you and the lender.