What is the Minimum Credit Score Requirement For a Car Loan ?

May 6th, 2009 admin Posted in Auto Loans | 2 Comments » 1,414 views

A good credit score is always helpful in getting a loan whether it is a personal loan, a home mortgage or an auto loan. There are many people who do not even care to have a look at their credit report. If you have never thought about it, then start doing so. Today FICO scores are used for the credit ratings. The range of these scores is from 300 to 850 for each individual.

Acceptable Credit Score for Auto Loan:

* The interest rates and the terms that you get on your loan depend on your credit score.

* Usually the lenders prefer the borrowers with the scores above 700. These borrowers are offered the best terms for their auto loan. Apart from the scores, various other issues are also considered like the income, down payments, trade and the previous relations with the dealers if any.

* If you have your score less than 760, you might need to check your credit report. You may need to know what you can do to improve your records. FICO score of 760 will offer you the best mortgage terms & interest rates.

* There are two main things that may help you get the best rates for an auto loan. One is the down payment and the other one is the FICO score. With a little difference in the acceptable credit score for an auto loan may force you to pay $200 extra every month.

* Your FICO score will not only determine the loan amount that you can get but the insurance agencies also use this to decide how much you need to pay for the insurance.

* To gain all the benefits, you need to get your credit report checked regularly and see if there is any possibility for any kind of improvement. You must be very particular about your financial records. So, you should not delay any of your payments.