In a Nutshell: Higher credit scores can lead to better credit opportunities, such as approval for credit cards or favorable terms on loans. But knowing exactly what it means to have good credit is a challenge. More than 100 million members use Credit Karma to help them understand and work on their credit scores. Here’s what it means to have good credit and what you can do to maintain it. Editorial Note: Intuit Credit Karma receives compensation from third-party advertisers, but that doesn’t affect.
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Absolutely! Your 722 credit score puts you in good standing for qualifying for an auto loan. In fact, with a credit score this high you’ll likely be able to secure a loan with competitive interest rates and favorable terms.
However, it’s important to remember that your credit score is just one factor that lenders consider when evaluating your loan application. Other factors, such as your income, debt-to-income ratio, and employment history, will also play a role in determining your eligibility and the terms you’re offered.
Here’s a closer look at how your car loan may be affected by your 722 credit score:
✅ Expanded Accessibility: Possessing a high credit score grants you access to a greater number of lenders and loan choices. This implies that you will have the ability to compare prices and terms to find what best suits your needs and budget.
✅ Lower Interest Rates: A higher credit score typically translates to lower interest rates. This can save you a significant amount of money over the life of your loan, especially if you’re financing a larger vehicle or taking out a longer-term loan.
Better Loan Terms: A credit score can also affect the conditions of your loan, including the required down payment and the length of the loan. Your total cost of borrowing can be further decreased if you can obtain a loan with a shorter loan term or a lower down payment thanks to your strong credit score.
However, it’s important to remember that even with a good credit score, there are still a few things you can do to improve your chances of getting the best possible car loan:
➡️ Shop Around: Don’t settle for the first offer you receive. To make sure you’re getting the best deal, compare terms and rates offered by different lenders.
➡️ Improve Your Debt-to-Income Ratio: A lower debt-to-income ratio shows lenders that you have more disposable income to make your loan payments. Consider paying down existing debt before applying for a car loan.
➡️ Increase Your Down Payment: Increasing your down payment can lower the amount of your loan and increase the likelihood that you will be approved for a lower interest rate.
➡️ Consider a Co-signer: If you have a limited credit history or a lower credit score, consider asking a co-signer with good credit to apply for the loan with you. This can improve your chances of approval and potentially lower your interest rate.
By using these pointers and your excellent credit score, you’ll be in a good position to get a car loan with terms that suit your needs financially and within your means.
Here are some additional resources that you may find helpful:
- Credit Karma: https://www.creditkarma.com/auto/
- WalletHub: https://wallethub.com/credit-score-range/722-credit-score
- Experian: https://www.experian.com/blogs/ask-experian/
- TransUnion: https://www.transunion.com/credit-help
Remember, the key to getting the best car loan is to be prepared and do your research. By understanding your credit score, your financial situation, and the different loan options available, you’ll be able to make an informed decision that’s right for you.
Hard inquiries by credit score range
| Credit score range | Average number of inquiries |
|---|---|
| 300–639 | 8 |
| 640–699 | 5 |
| 700–749 | 4 |
| 750–850 | 3 |
Ranges identified based on 2023 Credit Karma data.
How to get a 722 credit score
There are many things you can do to establish and keep your credit within a range, even though there is no foolproof method to obtain a specific credit score. Most importantly, you’ll want to practice healthy credit habits.
Certain general guidelines still hold true despite the wide range of credit scores that exist due to various credit bureau data and scoring models. Most credit scores take into account at least five main credit factors.
Here’s a breakdown of each factor and how it can affect your overall credit.
One of the more important factors in determining your overall credit health is your record of on-time payments. It’s that simple: Establishing credit can be greatly aided by consistently making on-time bill payments. Conversely, a single late payment can have a substantial impact on your scores and remain on your records for a maximum of seven years. So, consistency is key.
As you may already be aware, avoiding interest charges is possible when you pay off the entire balance on your credit card statement each month. However, it might also assist in reducing your credit utilization ratio—a crucial indicator of how much of your available credit you actually use each month. While the majority of experts advise maintaining your credit utilization ratio below 30%, it’s a good idea to keep it even lower if at all possible.
KEY FACTORS You Need to Know about Credit Scores and Car Loans (Former Dealer Explains)
FAQ
What can you do with a 722 credit score?
What is the lowest credit score to buy a car?
How big of a loan can I get with a 720 credit score?
What APR will I get with a 720 credit score?
Can you get a car loan with a 722 credit score?
You should be able to get approved for a decent car loan with a 722 credit score, considering that more than 60% of all auto loans go to people with credit scores below 740. Still, it’s important to compare your auto loan options carefully if you want to get a low APR.
Can you get a mortgage with a 722 credit score?
More than 40% of first mortgages go to borrowers with credit scores below 740, so you should be able to finance your home purchase without much issue. Student loans are some of the easiest loans to get with a 722 credit score, seeing as more than 70% of them are given to applicants with a credit score below 740.
How does your credit score affect car loan interest rates?
Your credit score determines your car loan interest rates. According to Experian’s State of the Automotive Finance Market report, the average auto loan interest rate for new cars in 2023’s fourth quarter was 7.18 percent, and 11.93 percent for used cars. Generally, the lower your score, the higher your annual percentage rate (APR) will be.
Can you get a car loan without a good credit score?
Lenders base your interest rates primarily on your credit score. But you can still get a decent rate without top-tier credit. To see how much of a difference a higher credit score can make for your rates, check out the average car loan interest rates by credit score. Your hometown also impacts the rate you receive.