With a credit score of 600 to 609, you should qualify for a high-risk APR rate, which will be higher than someone with a credit score of 700 or 800. The average rate for a used car loan in the 600 to 609 credit range is 10.33% (44 or 75% higher than the average rate for a new car). No matter what your credit score is, looking for a car loan and comparing what each lender has to offer is a smart move. Knowing your credit score before you start researching makes it easier to narrow down the types of loans you might qualify for.
A credit score of 600 won't necessarily stop you from getting an auto loan, but it will likely make that loan more expensive. Taking steps to improve your rating before you apply for a car loan can put you in the driver's seat and make it easier to negotiate the best possible loan terms. To avoid such unpleasant surprises from ruining your loan application, it's a good idea to check your credit report a month or two before you apply for an auto loan. Your website uses your loan application to calculate an estimated approval amount before asking you to complete the loan application.
A target credit score of 661 or higher should give you a new car loan with an annual percentage rate of about 4.03% or higher, or a used car loan of about 5.53% or less. Title loans usually have a higher than average interest rate, and 20% of title loans result in repossession. Most loans have no prepayment penalties, so you can repay your loan at any time to avoid additional interest charges. So will a score like that be a stop sign or just a speed bump? You may be able to get an auto loan with a credit score of 600, but there are other factors that lenders will consider in determining your eligibility for a loan.
The available amount of your car loan is probably less than that of an auto loan for a primary borrower at a bank or credit union. Before accepting your loan application and setting the terms of the loan, car lenders will carefully review your credit report. The last factor that makes car loans easier for consumers with low ratings is that the loans are guaranteed and guaranteed by the down payment and the value of the financed vehicle. If you are approved for an auto loan despite having a lower credit rating, your loan will likely have a higher interest rate than it would if you had a good credit rating.
