If your FICO® Score is 666, you fall into the category of customers whose credit may be viewed as Fair. Your 666 FICO® Score is lower than the average U. S. credit score.
According to statistics, 28% of customers with credit scores within the Fair range are likely to become seriously delinquent in the future.
Certain lenders find those odds unappealing and refuse to work with borrowers whose FICO® Scores are in this range. Conversely, lenders specializing in “subprime” loans might look for borrowers with Fair credit, but they usually impose exorbitant costs and high interest rates. Consumers with FICO® Scores in the good range (670-739) or higher are generally offered significantly better borrowing terms.
The Devil’s in the Details: Demystifying Your 666 Credit Score for Car Loans
The number 666 has long been associated with the devil, but when it comes to your credit score, it’s not quite as sinister. In fact, a 666 credit score falls within the “fair” range, meaning it’s not great, but it’s not terrible either. While you might not qualify for the best interest rates on a car loan, there are still ways to get a decent deal with a 666 credit score.
Understanding Your 666 Credit Score
Before we delve into car loans, let’s understand what your 666 credit score means. According to Experian, a credit score of 666 places you within the population of consumers whose credit may be seen as “fair” This score is lower than the average US. credit score of 714.
The Impact of a 666 Credit Score on Car Loans
Interest rates on auto loans will probably be higher for borrowers with a 666 credit score than for those with higher scores. However, it doesn’t mean you’re automatically doomed to exorbitant rates. Here’s what you can expect:
- Higher APRs: Lenders consider your credit score a major factor when determining the interest rate on your loan. With a 666 score, you’ll likely be offered an APR that’s higher than the average for borrowers with good or excellent credit.
- Limited Loan Options: Your choice of lenders and loan terms might be restricted with a fair credit score. Some lenders might not even consider your application, while others might offer less favorable terms.
Strategies to Improve Your 666 Credit Score
Don’t let your 666 credit score hold you back. You can take the following actions to strengthen it and possibly be eligible for better loan terms:
- Pay Your Bills on Time: This is the single most important factor affecting your credit score. Make sure you pay all your bills, including credit card bills and utilities, on time every month.
- Keep Your Credit Utilization Low: Your credit utilization ratio is the amount of credit you’re using compared to your total available credit. Aim to keep this ratio below 30%.
- Dispute Errors on Your Credit Report: Check your credit report regularly for any errors and dispute them with the credit bureaus.
- Become an Authorized User on a Credit Card: If you have a friend or family member with good credit, ask them to add you as an authorized user on their credit card. This can help improve your credit score over time.
Getting a Car Loan with a 666 Credit Score
Even with a 666 credit score, you can still get a car loan. Here are some tips:
- Shop Around for Lenders: Compare interest rates and loan terms from multiple lenders to find the best deal.
- Consider a Cosigner: If you have a cosigner with good credit, it can help you qualify for a lower interest rate.
- Make a Larger Down Payment: Putting down a larger down payment can reduce the amount you need to borrow and potentially lower your monthly payments.
- Focus on Building Your Credit: While you’re shopping for a car loan, work on improving your credit score. This will give you more options and potentially lower interest rates in the future.
Remember, a 666 credit score isn’t the end of the world. You can raise your credit score and obtain a car loan with terms that work for you with a little work.
Improving Your Credit Score
It takes time to resolve some of the negative factors that contribute to fair credit scores, like bankruptcy and foreclosure, and fair credit scores cannot be instantly transformed into exceptional ones. Regardless of the cause of your Fair score, you can start right away to raise your credit utilization, which can raise your credit score.
Look into obtaining a secured credit card. You must deposit the full amount of your spending limit—usually a few hundred dollars—in order to use a secured credit card. Verify that the lender records your activity on the card and sends it to the national credit bureaus so that it appears in your credit files as you use it and make regular payments. (Making timely payments and avoiding “maxing out” the card will favor credit-score improvements.
Consider a credit-builder loan. These loans come in a variety of forms and are offered by numerous credit unions; however, they are all intended to help individuals establish better credit records. In a common arrangement, the credit union saves the money you borrow in an account that you cannot access until the loan is repaid, earning interest. Once youve paid the loan in full, you get access to the funds and the accumulated interest. Although it’s a clever savings tool, regular, on-time payments can raise your credit score because the credit union reports your payments to national credit bureaus. (Check before taking out a loan to make sure the lender reports to all three national credit bureaus. ).
Consider a debt-management plan. Families that are struggling to make ends meet due to debt payments may find much-needed relief through a debt-management plan (DMP). To obtain one, you must engage with a certified credit counseling organization, which will bargain with your creditors to establish a manageable repayment schedule. Although it’s a drastic measure that essentially closes all of your credit accounts and drastically lowers your credit score, it’s less severe than filing for bankruptcy and can help struggling families get back on their feet. Meeting with a credit counselor rather than a credit-repair business may provide you with new strategies for enhancing your credit, even if you determine a DMP isn’t for you.
Pay your bills on time. Late and missed payments hurt credit scores, so avoid them. Use automated tools such as calendar alarms and payments, or stick to using paper calendars and sticky notes. Make every effort to aid in your memory, and you will quickly adopt positive behaviors that will raise your credit score.
Avoid high credit utilization rates. High credit utilization, or debt usage. According to this measurement, the FICO%C2%AE%20scoring%20system%20bases%20your%20credit%20score%20on%20this%20measurement%E2%80%94, which is the percentage of your available credit limit that is represented by your outstanding payment balances. Try to keep your utilization across all your accounts below about 30% to avoid lowering your score.
Try to establish a solid credit mix. While you shouldn’t take on more debt than you can manage, borrowing sensibly and combining installment and revolving credit can help your credit score.
Moving past a Fair credit score
While each person who achieves a FICO® Score of 666 does so in a different way, those with scores in the Fair range frequently struggle with managing their credit.
People with Fair credit cores in the Fair range typically have collections accounts—a sign that a creditor has given up trying to collect an unpaid debt and sold the obligation to a third-party collections agency—and late payments (30 days or more past due) on their credit reports.
Some individuals with FICO® Scores in the Fair range might even have significant adverse events—like bankruptcies or foreclosures—on their credit reports, which can significantly reduce scores. Even though it might take ten years to fully recover from these setbacks, you can start taking action right away to move your score in the right direction.
Studying the report that accompanies your FICO® Score can help you identify the events that lowered your score. You can create the foundation for raising your credit score if you stop the actions that caused those things and gradually work to improve your credit.
KEY FACTORS You Need to Know about Credit Scores and Car Loans (Former Dealer Explains)
FAQ
Can I get a car loan with 666 credit score?
What kind of loan can I get with 666 credit score?
What is a decent credit score to buy a car?
Is 660 a good credit score to buy a car?
What is a 666 FICO ® score?
A 666 FICO ® Score is a good starting point for building a better credit score. Boosting your score into the good range could help you gain access to more credit options, lower interest rates, and reduced fees.
Is 666 a good credit score?
What’s more, your score of 666 is very close to the Good credit score range of 670-739. With some work, you may be able to reach (and even exceed) that score range, which could mean access to a greater range of credit and loans, at better interest rates. The best approach to improving your credit score starts with a check of your FICO ® Score.
Does a 666 credit score affect a personal loan?
Increasing a 666 credit score even slightly can result in much more attractive loan rate offers. The difference is most stark among personal loans: According to recent LendingTree data, increasing a 666 credit score by 20 points can reduce the average APR of a personal loan from 24.74% to 19.04%.
How much credit card debt does a 666 score mean?
Among consumers with a FICO ® Score of 666, the average credit card debt is $13,429. Payment history. Delinquent accounts and late or missed payments can harm your credit score. A history of paying your bills on time will help your credit score.