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What Is a Good Credit Score to Buy a Car?

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What we’ll cover:

  • There is no credit score cutoff for buying a car, but your score will impact your interest rate
  • Your credit score is just one of many factors that auto lenders will assess when offering your interest rate
  • Other factors include loan amount, loan duration, vehicle down payment, vehicle type, your income/debts

You might be in the market for a new set of wheels. Or maybe you know someone who is. 

If so, you may be wondering “What’s a good credit score to buy a car?”

The simple answer is that there is not a general cutoff for the credit score you need to qualify for a car loan. It’s possible to buy a car with a range of credit scores. 

The bigger takeaway is this: the higher your credit score is, the more favorable terms you could get on your auto loan.

Did you know credit scoring models vary? 

When asking what credit score is needed to buy a car, it’s important to understand how auto lenders could assess your creditworthiness. They may consider one of several scoring models to make that determination.

According to Experian, one of the nation’s leading credit reporting firms, auto lenders might refer to one of the following:

  • FICO 8 and 9: These are simply updated versions of FICO's standard credit score model. Your credit card issuer or credit monitoring service might already give you access to one of these scores, in which case you can check your own credit score ahead of time.
  • FICO Auto Scores: FICO has scoring models specific to the auto industry that are based on specific information to predict your likelihood of paying back a car loan on time. 
  • VantageScore® 3.0 or 4.0: The VantageScore models vary from the FICO models, but they use the same information (your credit report) to determine your creditworthiness. It’s worth noting that not all lenders use VantageScore.

Understanding the FICO scoring range

FICO scores assign values to the information included in your credit report. Regarded by many lenders and financial institutions as a measure of a consumer’s creditworthiness, FICO scores range from 300 to 850 and are tiered as follows:

  • Exceptional: 800-850
  • Very good: 740-799
  • Good: 670-739
  • Fair: 580-669
  • Poor: 300-579

Because they are looked upon as a measure of a borrower’s creditworthiness, the higher the FICO score you achieve, the more favorable the terms you can expect when borrowing. A higher credit score typically earns you lower interest rates than a lower credit score would earn.

Your credit score is just part of the picture

With that said, lenders may consider more than your credit score when determining your interest rate on an auto loan. Here are other factors they typically consider:

  • The loan amount and how much time it will take you to pay back the loan
  • The down payment on the vehicle
  • The type of vehicle, and whether you are purchasing a new or used one
  • Your income and debts

Remember the question isn’t necessarily “What credit score do you need to buy a car?” as there’s no formal cutoff. Instead, think of your credit score as just one of several factors that lenders will assess when determining your interest rate. Generally speaking, the higher your credit score, the more likely you are to get favorable terms on your auto loan.

This article is for informational purposes only and is not a substitute for individualized professional advice. Individuals should consult their own tax advisor for matters specific to their own taxes and nothing communicated to you herein should be considered tax advice. This article was prepared by and approved by Marcus by Goldman Sachs, but does not reflect the institutional opinions of Goldman Sachs Bank USA, Goldman Sachs Group, Inc. or any of their affiliates, subsidiaries or division. Goldman Sachs Bank USA does not provide any financial, economic, legal, accounting, tax or other recommendation in this article. Information and opinions expressed in this article are as of the date of this material only and subject to change without notice.  Information contained in this article does not constitute the provision of investment advice by Goldman Sachs Bank USA or any its affiliates. Neither Goldman Sachs Bank USA nor any of its affiliates makes any representations or warranties, express or implied, as to the accuracy or completeness of the statements or any information contained in this document and any liability therefore is expressly disclaimed.

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