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What is the credit score needed for a car loan?
I’m going to need a car loan for my next car. What credit score do I need to shoot for to secure one?
Lauren Smith · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
Generally, any score in the prime range or above (that is, 661 or higher) is a safe bet if you’re looking to get approved for a car loan.
A prime or higher credit score will give you access to lower interest rates, allowing you to pay less in the long run.
If your score is subprime or lower, you still have a chance at getting approved for a loan, but your terms won’t be as favorable. Students and people with no credit history can apply for special programs, like first-time buyer loan programs, if applicable.
If you can’t reach a prime or higher score, you may need to bring a cosigner onto the loan in order to get approved. A cosigner is a third party with a high credit score who agrees to assume responsibility for the loan if you fail to make payments.
If you end up stuck with unfavorable loan rates, you can always complete an
auto refinance
to renegotiate your terms down the road. If your credit has improved by then, you would also be able to remove your cosigner.In the meantime, you should consider shopping around for car insurance quotes to make sure you aren’t missing out on potential savings that could go toward the new car. Use
Jerry
to compare dozens of competitive quotes without any hassle or pressure. MORE: How to refinance a car
View full answer
- Gregory R.
WHY YOU CAN TRUST JERRY
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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