When looking to buy a car, whether it is used or new, many people opt for an auto loan. If you fall into this category, it is important to keep track of your credit score.
Knowing your credit score can greatly impact your ability to get an auto loan. This article will explain how to manage your credit score to make it more likely for you to obtain an auto loan.
Getting a Car Loan in 2019
The minimum credit score requirements necessary to obtain a car loan in 2019 will be dictated by the average credit scores of people who purchased a car using an auto loan in the previous years. This does not mean that you will not be approved an auto loan if your credit score is below average. However, the terms may not be favorable. The average credit score for car buyers has remained fairly consistent throughout the previous several years. It was 721 for a new car, and 641 for a used car in the year 2017.
Understanding Credit Score Requirements For an Auto Loan
There are several reasons for which it is important to understand the credit requirements and your own credit score before applying for a car loan. The higher your credit score, the more favorable the terms of the loan. Additionally, interest rates for new cars tend to be higher than for used cars. All of this information is useful because it can help you save money.
Credit Scores Necessary for Obtaining a Car Loan
There is no set score that will get the lenders to approve your loan application. This is because every lender sets up different requirements. However, knowing your credit score and understanding how it affects your chances of getting a car loan is crucial because it may alert you to improve your credit score on time. Whatever option you end up choosing, the safest bet is to get your credit score in as good of a shape as possible before buying a new car.