CarGurus, Capital One team up to pre-qualify on shopping site

CarGurus this month will expand its 5-million-vehicle shopping platform to include a financing component powered by Capital One Auto Finance, the companies said Tuesday.

CarGurus will offer auto finance prequalification on some of the inventory featured on its site. The program will roll out nationwide over the next two weeks to more than 10,000 dealerships that work with both companies.

Capital One partners with 13,000 dealers nationwide with inventories of more than 4 million vehicles, according to the company. CarGurus has more than 5 million vehicle listings on its site and a network of more than 40,000 dealers.

The "View Financing Offers" feature on the CarGurus' payment calculator will allow customers to obtain prequalification for an interest rate and monthly payment on eligible vehicles without affecting their credit score, according to CarGurus.

After customers complete the application process once, they can click the financing options on another vehicle description page from a Capital One-partnered dealer to access prequalified rates and terms.

Online prequalification helps "bring transparency to the car buying process," Jeffrey Rabinowitz, head of consumer auto finance at Capital One, said in a statement.

Prequalification benefits both the customer and the dealer, said Tom Caputo, chief product officer for CarGurus. Shoppers enter the store with a viable offer and are confident in their vehicle choice, he said. They save time at the dealership because they're less likely to debate on vehicles and compare payments in-store.

"We have always recognized the importance of the finance and insurance profits for dealers," Caputo told Automotive News. "We worked hard to put together a program that would provide value to consumers but would also work well for dealers."

If they choose to go forward with the Capital One offer, customers would still have to complete a credit application at the dealership, which would honor the offer, CarGurus said.