Because a credit score is an important indicator for determining a consumer’s creditworthiness when buying a car, those with excellent credit histories tend to have an easier time borrowing money on favorable terms compared to those with lower credit scores.
However, industry data shows that high-risk borrowers remain viable candidates for auto loans. In other words, there is no universally defined credit score needed to buy a car.
Read on to learn how your credit score can affect buying a car, plus some tips for purchasing a car with a lower credit score.
There are a few different scoring models that car dealers may use for determining a customer’s credit score.
They may use the FICO Auto Score 10, an industry-specific model featuring a score range from 250 to 900. The auto industry also may use VantageScore 3.0 or the newer VantageScore 4.0 model, which has a score range from 300 to 850.
No matter which scoring model is used, a bad credit score falls on the lower end of the range, and a good credit score sits on the higher end of the range.