Car Deal Canada

Is AB Auto Clearance Legit?

Is AB Auto Clearance Legit?

Purchasing a car is one of the biggest financial commitments many Canadians will make. Unless you have enough cash saved up, you’ll likely need to take out a loan to finance your vehicle. With so many lenders and financing options out there, it’s crucial to do your research upfront.


Taking the time to understand auto loans, compare rates and fees, and verify the legitimacy of lenders can save you thousands of dollars and protect you from predatory or fraudulent lending practices. In this comprehensive guide, we’ll walk through everything you need to know about getting a legitimate and affordable car loan in Canada.


The three main options for financing a vehicle purchase are through a bank or credit union, directly at the auto dealership, or with an online lender. All three have pros and cons in terms of interest rates, approval criteria, and trustworthiness that we’ll explore in-depth. We’ll also dive into specific lenders like AB Auto Clearance to scrutinize their legitimacy.


At the end of the day, being an informed consumer is your best defense against shady lenders or getting trapped in a bad loan. With the right knowledge and preparation, you can confidently secure the proper financing to drive away in your dream car without overpaying.

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Trusted Banks and Credit Unions for Auto Financing

When it comes to securing a legitimate car loan in Canada, major banks and credit unions are often the safest bet. These established financial institutions are heavily regulated and have robust lending practices in place. They typically offer competitive interest rates, though these can vary based on your credit score, income, and the vehicle you’re financing.

Here’s a quick overview of what you can generally expect from the big banks for an auto loan in Canada:

 

  • Interest Rates: Between 5-10% for those with good credit; higher for subprime borrowers
  • Loan Terms: Typically 3-7 years for new vehicles, 3-5 years for used
  • Down Payment: As low as 0% for well-qualified buyers on new cars, but usually 10-20% down
  • Fees: Application fees up to $300; some institutions have no fees

 

To get approved for a bank or credit union auto loan, you’ll need to provide proof of income, employment details, residency status, and information on the vehicle. Your credit report and score will be a major factor. Most require a minimum score of around 670, but some offer non-prime financing.

The pros of financing through a bank include the security of a major lender, potential rate discounts for bundling services, longer repayment periods, and more flexibility on loan amounts. The cons are stricter approval criteria, more documentation required, and potentially higher rates if your credit isn’t great.

 

Financing Through a Dealership: What to Watch Out For

Dealership financing is a common option for many car buyers in Canada. When you purchase a vehicle from a dealership, they will likely offer in-house financing or partner lenders to help you secure an auto loan. This can be convenient, but it’s important to understand the potential pitfalls.

One advantage of dealership financing is that manufacturers sometimes offer incentives like low or 0% interest rates for qualified buyers. These deals can save you money over the life of the loan. However, the fine print usually requires having an excellent credit score and making a large down payment.

A major risk with dealership loans is the threat of yo-yo financing or spot delivery scams. This is when a dealer allows you to drive off the lot with a new vehicle after being pre-approved for financing, only to call you back days or weeks later claiming the original loan fell through. The dealer then pressures you into accepting much higher interest rates or down payments, threatening to repossess the car if you don’t agree.

While yo-yo financing is illegal in many provinces, it still happens. Dealers may claim the new terms are due to errors in your credit application or income information. Getting pre-approved for a loan amount from a bank or credit union can help avoid this predatory tactic.

Another potential issue is hidden fees or add-ons that artificially inflate the vehicle price or monthly payments. Always read the fine print and understand all costs before signing any paperwork.

 

Online Car Lenders in Canada: Legit or Not?

In recent years, a growing number of online car loan providers have emerged in Canada, offering an alternative to traditional bank financing and dealership loans. The convenience of applying for an auto loan online from the comfort of home is undeniably appealing. However, it’s crucial to exercise caution and thoroughly research any online lender before sharing personal and financial information.

One of the most well-known online car loan platforms in Canada is Car Loans Canada. This company operates as a lending marketplace, connecting borrowers with a network of lenders, including major banks like BMO, RBC, Scotiabank, TD, CIBC, National Bank, and Desjardins. Car Loans Canada claims to offer competitive rates and a streamlined application process.

While Car Loans Canada appears to be a legitimate operation backed by reputable financial institutions, it’s essential to read customer reviews and scrutinize the company’s lending practices. Some borrowers have reported issues with hidden fees, unclear terms, and difficulties during the loan process. As with any online lender, it’s crucial to read the fine print and understand all costs and conditions before signing any agreement.

Beyond Car Loans Canada, numerous other online car loan providers operate in the Canadian market, each with varying levels of legitimacy and trustworthiness. Conducting thorough research on any lender’s licensing, accreditations, customer reviews, and lending terms is vital to avoid potential scams or predatory lending practices.

 

AB Auto Clearance Loan Provider Review

AB Auto Clearance is a Canadian car loan provider that has gained significant attention in recent years, advertising easy approval for borrowers with any credit score. But is this lender truly legitimate, or should prospective car buyers steer clear? Let’s take a closer look at what AB Auto Clearance has to offer.

 

Background and Approval Criteria

Based in Alberta, AB Auto Clearance claims to be “the most trusted Car Loan Provider in Canada,” having helped over 50,000 Canadians secure auto financing. The company promises a quick online application process and high approval rates, even for those with poor credit histories or limited time in the country.

According to the AB Auto Clearance website, there are no strict criteria for approval beyond being a Canadian citizen or permanent resident. This raises some red flags, as most reputable lenders have minimum credit score and income requirements to assess a borrower’s ability to repay the loan.

 

Interest Rates and Fees

Unfortunately, AB Auto Clearance does not publicly disclose its interest rates or fees for car loans. This lack of transparency makes it difficult for consumers to compare offers and understand the true cost of financing. Legitimate lenders typically provide clear rate and fee information upfront to build trust with borrowers.

 

Privacy Policy and Data Handling

Reviewing AB Auto Clearance’s privacy policy reveals some concerning details about how the company handles personal data. The policy states that AB Auto Clearance and its agents/affiliates may sell or disclose users’ personal information to other wholesale lead providers or lenders without explicit consent.

This raises questions about the company’s data practices and whether customer information is being shared or sold for marketing purposes beyond the scope of the initial loan application.

 

Customer Reviews and Complaints

A search for AB Auto Clearance reviews online yields a mix of positive and negative feedback from past customers. Some praise the easy approval process, while others report issues such as high interest rates, hidden fees, and poor customer service.

It’s worth noting that AB Auto Clearance does not appear to be accredited by the Better Business Bureau (BBB) or approved by the Canadian Lenders Association, which are typically indicators of a company’s legitimacy and commitment to ethical business practices.

 

Canadian Lenders Association: What It Means for Legitimacy

The Canadian Lenders Association (CLA) is a national organization representing firms involved in lending, from banks and credit unions to alternative and online lenders. Membership in the CLA signifies a commitment to upholding best practices and a code of conduct.

While AB Auto Clearance claims to be “approved by the Canadian Lenders Association” on its website, I could not find them listed as a current member on the CLA directory. This raises some questions about their legitimacy and adherence to industry standards.

Membership in the CLA requires lenders to be appropriately licensed and demonstrate responsible lending practices. The association aims to protect consumers from predatory lenders and unethical business conduct. Without clear CLA membership, AB Auto Clearance’s claims should be scrutinized.

Legitimate lenders will often proudly display their CLA membership status and certification number. The lack of transparency around AB Auto Clearance’s affiliation with the association is a potential red flag for consumers.

 

Better Business Bureau Accreditation: Why It Matters

One way to gauge the legitimacy of a business is by checking if they are accredited by the Better Business Bureau (BBB). The BBB is a non-profit organization that sets standards for ethical business behavior and monitors companies’ reliability through a rating system.

To become BBB accredited, a business must meet the BBB’s accreditation standards, which include:

 

  • Commitment to making a good faith effort to resolve consumer complaints
  • Adherence to the BBB’s standards for truth in advertising
  • Maintaining transparent business practices
  • Safeguarding privacy principles
  • Embodying integrity in all business dealings

 

While BBB accreditation is voluntary, it serves as a stamp of approval that the company operates ethically and transparently. Businesses that earn BBB accreditation are monitored and held accountable for maintaining the organization’s high standards.

In the case of AB Auto Clearance, the company does not appear to be BBB accredited based on searches on the BBB website. This lack of accreditation could raise concerns about the company’s commitment to ethical business practices and transparency, which are crucial factors when dealing with a lender.

 

Data Privacy with AB Auto Clearance and Other Lenders

When applying for any kind of loan or financing, you’ll be sharing a significant amount of personal and financial information. It’s crucial to ensure that lenders have robust data privacy and security measures in place to protect this sensitive data. A lender’s privacy policy should clearly outline how they collect, use, store, and share your information.

Upon reviewing AB Auto Clearance’s privacy policy, there are a few concerning aspects regarding data handling. The policy states that they may sell or disclose personal information submitted through loan applications to other lead providers, marketing companies, and third parties. This means your data could potentially be shared quite broadly without your explicit consent.

Additionally, AB Auto Clearance says they cannot guarantee the security of information transmitted over the internet, which raises questions about the strength of their data protection practices. As a customer, you’d be taking on risk in terms of your private details being compromised or mishandled.

In contrast, major banks and credit unions tend to have very stringent privacy policies and robust security systems to safeguard customer data. They are also subject to stricter government oversight and regulations around data protection. When financing through a reputable, established lender, you can have more peace of mind that your personal information is being properly secured.

Be very cautious about sharing sensitive data like your Social Insurance Number, banking details, or pay stubs with any lender that lacks a clear, customer-friendly privacy policy. Always read the fine print and make sure you’re comfortable with how a company will use and protect your private information before proceeding with a loan application.

 

Real Customer Reviews of AB Auto Clearance Car Loans

To get a balanced perspective on AB Auto Clearance’s legitimacy, it’s essential to look at real customer reviews and experiences with their car loan services. While the company’s website and marketing materials may portray a polished image, unbiased feedback from borrowers can reveal insights into the actual lending process, customer service, and overall satisfaction levels.

On popular review platforms like Google Reviews and TrustPilot, AB Auto Clearance maintains an average rating of around 4 out of 5 stars. Many positive reviews praise the company for its quick and easy approval process, even for individuals with poor or limited credit histories. Satisfied customers highlight the straightforward online application, fast response times, and the ability to secure financing when other lenders had denied them.

One Google reviewer named Jason P. shared, “AB Auto Clearance made getting a car loan so easy. I had some credit issues in the past, but they still approved me for a decent rate. The whole process was smooth, and I had the money in my account within a few days.

However, not all customer experiences have been positive. Some negative reviews mention high-interest rates, inflexible repayment terms, and difficulties resolving issues with customer service. A TrustPilot user named Emily B. wrote, “I wish I had read the fine print more carefully. The interest rate they gave me was way higher than advertised, and when I tried to negotiate, they weren’t willing to budge. Now I’m stuck in a loan that’s costing me much more than I expected.

Other complaints cite issues with transparency regarding fees, hidden charges, and a lack of clear communication throughout the loan process. While some customers praise AB Auto Clearance’s accessibility for those with poor credit, others caution that this convenience may come at the cost of unfavorable terms or subpar customer service.

 

Other Car Loan Providers to Consider in Canada

While AB Auto Clearance may be one of the more well-known online car loan providers in Canada, there are several other options worth considering if you’re in the market for an auto loan.

 

Canada Drives is a reputable online platform that specializes in connecting Canadians with lenders, even those with poor or no credit history. Canada Drives partners with major banks, credit unions, and other trusted lenders to provide a wide range of financing options. Their user-friendly website makes it easy to apply and get pre-approved for a car loan.

Birchwood Credit Solutions is another popular choice for Canadians seeking auto financing. This Winnipeg-based company has been in business for over 60 years and offers a variety of loan products, including new and used car loans, as well as refinancing options. Birchwood Credit Solutions prides itself on its transparent pricing and personalized service.

Car Deal Canada is an online lender that specializes in providing car loans to individuals with less-than-perfect credit. They work with a network of lenders across Canada to offer competitive rates and flexible repayment terms. Car Deal Canada also offers a wide selection of vehicles through its affiliated dealerships.

Go Auto Express is a division of the Canadian Western Bank and provides financing for both new and used vehicles. They offer a range of loan products, including traditional auto loans, leasing options, and refinancing solutions. Go Auto Express is known for its streamlined application process and competitive interest rates.

 

7 Common Car Loan Scams to Avoid in Canada

While most auto lenders in Canada are legitimate businesses, there are unfortunately some unscrupulous operators out there trying to take advantage of unsuspecting car buyers. Being aware of common car loan scams can help you steer clear of them. Here are seven shady tactics to watch out for:

 

  1. Fake Lender Scams

Some scammers create fake auto loan websites designed to look like real lenders. Once you provide your personal and financial information, they can use it for identity theft or drain your bank accounts. Always verify you’re dealing with a legitimate, accredited lender.

 

  1. Bait and Switch Scams

You’re promised a low interest rate to get you to apply, but later told you don’t qualify and are switched to a much higher rate. Reputable lenders are upfront about rates and terms you actually qualify for based on your credit.

 

  1. Yo-Yo or Spot Delivery Scams

You drive off the lot with a new car, only to have the dealer call you back days later to say your financing fell through and demand a higher payment or down payment. This is illegal – the deal should be final once you sign.

 

  1. Identity Theft Scams

Scammers get you to provide personal and financial details like your driver’s license and SIN number, then use that information for identity theft or to open fraudulent accounts. Never give out sensitive info unless you initiated the process and verified the lender.

 

  1. Advance Fee Scams

You’re asked to pay an upfront fee for “processing” or “underwriting” before you can get approved. Legitimate lenders don’t require this – it’s just a way for scammers to take your money.

 

  1. Fake Down Payment Scams

The scammer claims you need to put down a security deposit to get pre-approved or guarantee financing, then disappears with your money. Don’t pay any down payment until the very end when you’re signing final loan papers.

 

  1. Buy-Here-Pay-Here Dealer Scams

Some sketchy dealers offer in-house financing, but engage in deceptive practices like not disclosing fees, drastically overcharging, or putting tampered odometers on used cars. Stick to banks or trusted third-party lenders.

 

Getting Pre-Approved for the Best Car Loan Rates

One of the smartest moves you can make when shopping for an auto loan is to get pre-approved for financing before you start looking at vehicles. Getting pre-approved gives you significant leverage when negotiating with dealers and online lenders.

Pre-approval from a bank or credit union allows you to walk into the dealership knowing exactly how much you can afford to borrow and at what interest rate. This prevents dealers from convincing you to take a bad deal with unfavorable loan terms. When you have pre-approved financing already lined up, the dealer has to beat that rate and those terms to earn your business.

To get pre-approved, you’ll need to apply with your bank, credit union, or preferred lender. They will check your credit score, income, existing debts, and other financial information to determine your creditworthiness. If approved, they will issue you a pre-approval letter stating the maximum loan amount and current interest rate based on your credit profile.

Even if you don’t end up using the pre-approved financing, having that offer in hand is useful. You can show it to the dealer’s finance manager and see if they can match or beat those terms. If not, you can simply take the pre-approved loan and buy your desired vehicle elsewhere.

Getting pre-approved also allows you to shop around at multiple dealers without subjecting your credit to excessive hard inquiries. Each time a lender does a hard pull on your credit, it can temporarily lower your score. But with pre-approval, you only need to go through the hard inquiry process once.

 

Negotiating the Best Car Loan Terms in Canada

Once you’ve shopped around and compared options from banks, credit unions, dealerships, and online lenders, it’s time to negotiate the best possible car loan terms. Even a small difference in interest rate or fees can add up to thousands over the life of the loan.

 

Getting a Lower Interest Rate:

 

  • Improve your credit score – Higher scores get better rates, so pay down debts and fix errors on your credit report
  • Make a larger down payment – More cash upfront reduces the lender’s risk, making them more likely to offer a lower rate
  • Negotiate firmly but politely – Don’t be afraid to ask for a better rate or point out competitors’ offers
  • Get quotes from multiple lenders – Having options gives you leverage to negotiate

 

Avoiding Unnecessary Fees:

 

  • Question every fee and ask what it covers – Administration fees, documentation fees, etc. are often inflated or unnecessary
  • Negotiate fees, don’t just accept them – Many fees have wiggle room if you ask
  • Walk away if fees are excessive – Dealers may reduce fees to keep your business

 

Understanding the Contract:

 

  • Read every word of the contract carefully before signing – Don’t skim or make assumptions
  • Ask for explanations of any unclear terms or fees
  • Never sign contracts with blank spaces – Ensure all details are filled out
  • Get the full terms and payment schedule in writing

 

With preparation, negotiation skills, and attention to detail on the contract, you can secure a fair and affordable car loan that works for your budget.

 

Newcomer Auto Financing Options in Canada

For new immigrants to Canada, securing an auto loan can be challenging due to a lack of credit history in the country. However, there are options available specifically designed to help newcomers get approved for vehicle financing.

One major hurdle is establishing credit, which lenders use to assess risk and determine loan eligibility. Without a credit file in Canada, newcomers may face higher interest rates or be denied loans altogether from traditional banks and credit unions. To build credit, experts recommend steps like getting a secured credit card, becoming an authorized user on someone else’s card, or applying for a credit product like a small loan.

Some lenders offer special newcomer car loan programs that don’t rely as heavily on domestic credit history. Instead, they may consider factors like employment, income, residency status, and evidence of financial responsibility from the applicant’s home country. These alternative data points help provide lenders a better overall risk profile.

For instance, many dealerships work with specialized auto finance companies that cater to new Canadians. They may accept different forms of identification, down payments as low as $0 for qualified borrowers, and give greater flexibility overall. The trade-off is that interest rates on these newcomer car loans will likely be higher than rates offered to borrowers with established Canadian credit.

Ultimately, securing an auto loan as a newcomer requires diligence, open communication with lenders about your specific situation, and a plan for building credit through on-time payments. With responsible financial habits, qualifying for better rates will become more achievable over time.

 

Is AB Auto Clearance a Legit Car Loan Option? The Verdict

After thoroughly researching AB Auto Clearance and evaluating multiple factors related to their legitimacy, here is our overall verdict on whether they are a trustworthy option for car loans in Canada:

 

AB Auto Clearance appears to be a legitimate car loan provider operating in Canada. They are accredited by the Better Business Bureau (BBB) and approved by the Canadian Lenders Association (CLA), two key indicators of a company’s credibility.

Their website provides transparency on interest rates, fees, and the loan process. While some customer reviews mention issues like high interest rates for poor credit, this is typical for subprime auto lenders.

AB Auto Clearance states they have helped over 50,000 Canadians get auto financing. Their privacy policy outlines how customer data is handled.

However, it’s still important to carefully review all loan documents, compare options from multiple lenders (including banks/credit unions), and ensure you understand all terms before signing a contract with any car loan provider.

Overall, based on our research, AB Auto Clearance seems to be operating legitimately as an online auto lender in Canada, though caution is always advised when taking out any loan. Getting pre-approved offers from other companies is recommended to secure the best rates and terms.

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Questions About AB Auto Clearance

abautoclearance.ca is an online car loan provider based in Alberta, Canada. They claim to offer quick approvals, free delivery, and work with any credit score. However, there are some concerns about their legitimacy. The Better Business Bureau has received complaints, and their practices around disclosing personal information have raised questions. It’s unclear if they work directly with lenders or sell leads. Proceed with caution when considering them for financing.

When searching for financing from an online provider, watch for these red flags:

 

– Pressure to provide personal information upfront before getting details on rates and terms

– Vague claims about working with “affiliated lenders” instead of direct relationships

– Complaints about misleading quotes or difficulty getting clear terms

– Requests to wire money without seeing the vehicle

– Lack of physical address, licensing, or transparent company information

 

Stick to large banks or reputable dealers to avoid scams. Legitimate lenders won’t hide key details and will clearly explain rates, fees, and policies.

In Canada, provincial governments oversee regulation of finance companies and lending. Check with your province’s consumer affairs office to verify licensing. For car loans, the company should have either a retail installment sales contract license or loan broker license depending on their role. You can also contact industry associations like the Canadian Lenders Association to check membership.

In Alberta, car dealers must advertise vehicles with an all-in price that includes all fees and levies. This means charges like freight, PDI, documentation fees cannot be added on at signing. Advertising a low price then tacking on extra charges over the advertised rate violates regulations. Legitimate fees will already be factored into the listed sale price.

No. Once a contract is signed for a set interest rate Alberta’s consumer protection laws do not allow dealers to come back later and change rates, a practice known as “yo-yo financing.” Consumers should report attempts to alter agreed upon financing terms to provincial regulators, as this qualifies as an unfair business practice.

If a dealer lets you take delivery of a vehicle before financing is finalized, then comes back with higher payments or different terms, report them immediately. Alberta considers this a deceptive practice. Contact AMVIC to file a complaint. You may be able to cancel the deal or have the original terms enforced. Always finalize approval before accepting possession.

Private sales can offer good deals but have more risk. Dealers provide warranties, must detail vehicle history, and follow stricter regulations. Weigh options carefully. Get any private sale cars inspected first and meet sellers at their home to confirm ownership. Query the Canadian Police Information Centre and provincial registries to check for liens, ownership confirmation, and accident reports.

When buying privately insist on seeing the vehicle registration with buyer/seller details, bill of sale or transfer form, vehicle history report like CarProof, safety certification if required, lien search from the provincial registry, identification from the seller, odometer disclosure, and any service records available. Confirm no liens or debts are attached to the car.

Online car buying from major dealerships that offer delivery can be safe if you take precautions: Review dealer licensing and reputation. Inspect the car immediately upon delivery before accepting it. Take it for an independent assessment if possible. Test drive extensively once delivered. Ensure your contract has provisions to facilitate returns if needed. Get all claims about features, condition etc. in writing.

To import a used car: Research import rules and confirm the VIN is eligible for import. Obtain USA title, registration, and import documents like Registrar of Imported Vehicles paperwork. Pay applicable taxes and duties. Have the vehicle inspected and certified to meet Canadian safety and emissions standards before registering it in your province.

Unlike dealers, individuals selling fewer than [4-6] vehicles per year privately do not need to charge GST/HST on the purchase price. However, imported used vehicles and private sales occurring across provincial borders may incur tax. The transaction also must take place at fair market value. Check with the CRA and your provincial tax authority to understand requirements.

Odometer fraud is illegal in Canada. The Canadian Council of Motor Transport Administrators has a database to check records and flags suspicious rollbacks. When buying privately, compare the mileage to service records and oil change stickers. Look for wear inconsistent with stated mileage. Confirm odometer disclosures in purchase paperwork to protect yourself from rollback scams.

CarProof and Carfax are the two major vehicle history report services in Canada. They compile registration, accident reports, lien checks, ownership confirmations, and mileage records from government and insurance sources into detailed reports. Most dealers provide them, but buyers can also purchase their own reports through companies’ websites to inform used car purchases.

Review reports for: Accident, repair, and damage reports that may signify structural issues or poor repairs. Registration gaps that could mean the car was junked/written off before being revived with a new VIN. Mileage inconsistencies pointing to potential odometer rollbacks. Multiple past owners over short periods that may indicate serious problems being dumped. Out of province titles requiring import verification.

While vehicle history reports from reputable providers deliver useful insights, they can sometimes miss information or have errors. Reports rely on available records that are not always comprehensive across jurisdictions. Use them as helpful guides but also physically inspect cars for signs of damage and assess condition based on mileage claims against wear and tear.

Alberta requires all vehicles to carry liability coverage of at least $200,000 third party liability and accident benefits. You must be insured anytime you drive. Optional coverage like collision, comprehensive and underinsured motorist protection are not mandatory but highly recommended to protect against damage costs.

Yes. Missing a payment gives insurers the right to cancel coverage after providing advance notification. Policies usually allow at least 30 days from a missed payment before cancellation occurs. Make sure to review cancellation terms closely as you can be left uninsured for lapsed payments in Alberta. Contact your provider immediately if you will miss a billing date.

Alberta maintains a publicly searchable Vehicle Identification Number registry showing salvage and rebuilt status. Check this registry before buying any used vehicle along with CarProof or CarFax reports. Look for registration gaps, out of province titles or lack of roadworthiness certification which can also indicate previous write-offs.

First, review your purchase paperwork to see if the vehicle’s history was misrepresented by the seller. If so, you may have grounds for legal action. Additionally, check if the rebuilt title and prior damage was properly disclosed to your insurance company, as failing to do so could risk denial of future claims. Ultimately, consulting a lawyer to understand your options is wise in these situations.

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