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Can I get a car loan with a 549 credit score?
I really need a car loan. My current car is in the shop, and the repair bill is $1,200. The mechanic told me the car isn’t worth that much, so I should get a new car. With a credit score of 549, am I eligible for a car loan?
Eric Schad · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
A 549 credit score puts you in the subprime range, which indicates that you’re a high-risk borrower. You might be able to get a
car loan
with this score, but your pool of lenders will be small, and the interest rates will likely be in the double digits.The first option to get a car loan is to work with a lender that specializes in bad credit loans. These lenders will approve you, but again, the interest rate will be high.
You can also try a buy here pay here dealership, which offers in-house financing. If they approve you (and they most likely will), expect a double-digit interest rate that can go as high as 20%.
Your next option is to boost your credit score and then apply for a car loan. To increase your credit score:
- Pay off high-interest debt
- Lower your credit utilization
- Pay off any delinquent accounts
Keep in mind that boosting your credit score may take several months or even years.
If you can’t wait that long, try to find a cosigner. A cosigner is a friend or family member with good or great credit that vouches for you on the loan. But if you don’t pay on time, their credit can take a hit. Make sure you pay on time to avoid unpleasantries with your cosigner.
And if you’re putting together a budget, remember that you need full coverage car insurance on top of your monthly car note, maintenance, and gas. If you’re not sure where to shop for car insurance,
Jerry
is a phenomenal place to start.Jerry is a licensed insurance broker that will find the most competitive quotes from over 50 top-rated insurers in minutes. After you find a great rate, Jerry can help you buy new insurance and cancel your old policy. Users save an average of $887 per year.
View full answer
- Gregory R.
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Jerry partners with more than 50 insurance companies, but our content is independently researched, written, and fact-checked by our team of editors and agents. We aren’t paid for reviews or other content.
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