Can I be approved for a car loan with a 420 credit score?
I want to get a car loan, but my 420 credit score is looking a bit low. Can I still get approved? What kind of interest rate am I looking at?
With a credit score of 420, you’re in the deep subprime range, which can make obtaining credit exceedingly difficult. That’s not to say you can’t get a car loan, but the number of lenders willing to work with you is guaranteed to shrink significantly compared to those with higher credit scores.
On average, you should expect a new car interest rate in the range of 13% to 16% and 20% to 22% for a used car. This means that you’re going to pay a ton in interest, regardless of the length of the term, as well as going deeply upside down on your car loan.
Despite these downsides, Experian estimates that up to 20% of car loans are taken out by those with a credit score in your range. So if you have the desire, you can probably find a lender.
The only question you have to ask is if you want to pay that much in interest. You might be better served by repairing your credit in other ways rather than taking on more debt. With a 420 credit score, you have plenty of room for improvement if you pay down old debt and eliminate any delinquent accounts.
A great way to free up money for a down payment or pay off old debt is to find lower rates for your car insurance. Try using the number-one-rated car insurance app, Jerry, to help you find the best deals. Jerry compares personalized rates from more than 50 top providers and delivers the best deals to your phone in minutes for free. The average Jerry driver saves $879 a year on car insurance!
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