GET A BETTER CAR
AT A LOWER PRICE
BAD CREDIT AUTO LOANS & LEASES
If you need to finance a new or used vehicle, pay close attention to your credit score. Lenders use it to determine the rate you’ll get on a loan whether you’ll get a loan at all. Those with higher scores generally receive the best rates, and finding the cheapest possible financing is becoming more important as the amount and length of auto loans continue to grow.
THE AVERAGE CREDIT SCORE NEEDED TO BUY OR LEASE A CAR
Borrowers who received financing for a new car in 2018 had an average credit score of 714. Those who borrowed funds for used cars had an average score of 655. Experian used a credit score model of 350-850. The difference between a 500 credit and a 700 credit score is around $215 a month in interest charges. If your financing term is 72 months long, you are looking at $15,480 in additional money owed.
Let's break this down so you can see the difference.
CREDIT SCORE 500
PERSON ONE, WITH A CREDIT SCORE OF 500 WILL SEE AN INTEREST RATE BETWEEN 17-19%. WHEN BORROWING $25,000 OVER 72 MONTHS THE MONTHLY PAYMENT IS $584
CREDIT SCORE 750
PERSON TWO, WITH A CREDIT SCORE OF 750 WILL SEE AN INTEREST RATE BETWEEN 2-4%. WHEN BORROWING $25,000 OVER 72 MONTHS THE MONTHLY PAYMENT IS $369
Person One & Person Two are buying the SAME EXACT CAR. The only difference, 200 points in their credit score. That is $215 per month which is over $15,000 on a 72-month loan. Person One will be paying a total of $40,000 for the SAME EXACT CAR.