Do you know your Credit Score? Even for those who are able to answer that question without looking it up have another problem. We hear all the time about ‘good’ credit and ‘bad’ credit scores but it’s never mentioned what credit score is needed to get yourself a car loan.
A major issue with determining what is the ideal score for obtaining something like a car loan is that the factors differ depending on where you go looking. Credit.com quotes a chief operating officer at Prestige Financial, “There is not a minimum score I could say. There are many lenders, many different opportunities, and there are many factors that go into an auto loan other than your credit score.”
What is these other factors that he mentioned? Besides credit score, it is also debt-to-income ration, employment history, and how well an individual has paid their loan in the past. In the case of an auto loan, have you had one in the past and if so, how on time were your payments?
Buyers with low credit scores have been in luck in the most recent years. The lending restrictions has eased up since the recession. The average score for a new car buyer in the last quarter of 2015 was 711. The same time frame in 2014, the credit score was 712. The average has been steadily decreasing since it hit a peak in 2009, right after the recession hit.
The average credit score for a used car buyer is following the same decline. Its peak during the recession was at a number of 659 and has dropped to 649 since then.
That still doesn’t do a good job of answering the question: What should your credit score be? Using the average listed for both new and used is a good metric. If you’re a ways away from the average, then it is time to start working on getting your credit score turned around. It’s worth the effort to get it fixed so you can open up opportunities for a better deal on a car loan.
If you have bad credit or low credit and need to get a new or used vehicle, be sure to contact us at Approved Loan Store. Get started today by filling out our secure online auto loan application here, and for more auto news and buying tips, like Approved Loan Store on Facebook, follow Approved Loan Store on Twitter, and subscribe to Approved Loan Store on YouTube!
Image courtesy of (Stuart Miles) at FreeDigitalPhotos.net