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What is a good credit score for a car

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Buying a new car or truck is a major purchase. Unless you are in a position to pay cash upfront to the dealer, you will have to consider financing options. The terms and conditions associated with your loan will determine just how much you actually pay for your car. Just like other forms of credit, the interest rate for a car loan is calculated using your credit score. Buyers with higher credit scores will see more favorable terms than those who have less than perfect credit. Before shopping for your next vehicle, take a few minutes to learn more about car financing and the impact of your credit score on it. Learn what a good credit score is .

Who Finances Your Car Loan?

Many buyers are under the false impression that the car dealership is the actual lender. Car dealerships sell cars but they do not provide financing to buyers. The car dealer is actually the middle man between the buyer and the financing company. Even though your car dealer is not providing the financing, they can help get

the ball rolling. For example, your dealer may help you fill out a loan application and run a credit check to get an idea of the type of terms for which you qualify. The final approval however must come from the bank or financing company who will perform a more detailed credit check before making their final determination.

Loan Terms Based On Credit Score

Buyer Beware

Before shopping for a new car or truck, consumers should review their credit report and credit score. Looking at the same information as a lender will give consumers an idea of what to expect in terms of financing. Buyers with good credit are better able to negotiate low interest rates while buyers with bad credit may decide to postpone plans to purchase a car until their credit is better. When it comes to credit scores and financing, a few points in either can cost or save you thousands of dollars in interest over the life of the loan. Any effort to save money or improve financing terms will pay off in the long run and ensure your purchase is one that you can afford.

Category: Credit

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