How does my credit score affect my car loan?

I want to get a car loan, but my credit score is only 690. I'm not really sure how credit works in a car loan. What effect will my score have on my car loan?

Answer
When it comes to car loans, your credit score will determine your loan eligibility and interest rates. Borrowers with credit scores below 600 to 660 may not even be able to get a car loan, and interest rates will be high.
While a credit score of 690 isn’t in the excellent range, it’s sitting right there in the prime range, which will get you a rate in the second tier of credit scores.
In 2021, a 690 credit score would get you an average interest rate of 3.54% on a new car or 5.54% on a used car. Remember that these are averages and your car loan interest rate could change depending on other factors, such as:
  • Length of credit history
  • Length of the car loan
  • Amount of income or debt-to-income ratio
Don’t forget that you also need to budget for car insurance, as lenders require full coverage when you take out a car loan. So to get the best rate for full coverage, use the Jerry app to compare quotes and find the right coverage match for your needs.
Eric Schad
Answered on Nov 18, 2021
Eric Schad has been a freelance writer for nearly a decade, as well as an SEO specialist and editor for the past five years. Before getting behind the keyboard, he worked in the finance and music industries (the perfect combo). With a wide array of professional and personal experiences, he’s developed a knack for tone and branding across many different verticals. Away from the computer, Schad is a blues guitar shredder, crazed sports fan, and always down for a spontaneous trip anywhere around the globe.
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