In summary, having less-than-ideal credit may not prevent you from obtaining a car loan, but it may have an impact on the interest rate and other loan conditions. Generally, the lower your credit scores, the higher your interest rate will be. However, there might be methods to obtain a better rate, such as obtaining a co-signer or making a down payment. Editorial Note: Intuit Credit Karma receives compensation from third-party advertisers, but that doesn’t affect.
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It’s definitely possible to get a car loan with a 590 credit score, but be prepared for a higher interest rate than someone with better credit. In fact as of November 2022, the typical borrower with prime credit (720 or higher FICO score) got an APR of 5.34% on a 60-month new auto loan. With a 590 credit score you’re likely looking at an APR closer to 10% or even higher.
Here’s the breakdown:
| Credit Score Range | Average APR for New Car Loans |
|---|---|
| 300-500 | 13.42% |
| 500-600 | 10.79% |
| 600-660 | 8.12% |
| 661-780 | 5.82% |
| 781-850 | 4.75% |
As you can see, the difference in interest rates can be significant. This means that even a small bump in your credit score could save you thousands of dollars over the life of your loan.
So what should you do if you need a new car but your credit score is 590?
Here are a few tips:
- Shop around for the best interest rate. Don’t just accept the first offer you get. Compare rates from multiple lenders to find the best deal.
- Make a down payment. The more money you can put down, the less you’ll have to borrow and the lower your monthly payments will be.
- Consider a co-signer. If you have a friend or family member with good credit, they may be willing to co-sign your loan. This can help you qualify for a lower interest rate.
- Improve your credit score. This is the best long-term solution. By paying your bills on time and keeping your credit utilization low, you can gradually improve your credit score and qualify for better interest rates in the future.
Here are some additional resources that you may find helpful:
- Credit Karma: This website provides free credit scores and reports, as well as tips on how to improve your credit.
- NerdWallet: This website offers a variety of tools and resources for comparing car loans and finding the best deal.
- Bankrate: This website provides information on current interest rates for car loans.
It’s important to remember that even with a 590 credit score, you still have options for getting a car loan. By following the tips above, you can increase your chances of getting a good deal on a new car.
How do my credit scores affect my car loan?
The interest rate and conditions of a car loan, as well as your ability to obtain one, may be impacted by your credit scores.
It’s usually a good idea to check your credit scores before you start looking for a car loan and to be aware of how they may affect the terms that auto lenders offer you for a new or used car loan. You should also take advantage of this chance to review your credit reports for any errors that might be lowering your credit scores.
Save for a down payment
Putting down money for a car loan could increase your chances of being accepted and possibly lower your interest rate. Additionally, making larger upfront payments will reduce the amount you need to borrow, potentially saving you money on interest over time.
You might be able to obtain a better interest rate or have your loan approved more quickly if you have a co-signer with better credit.
If you haven’t found a rate and loan terms that work for you, continue looking. Credit Karma can help by showing your estimated loan term, interest rate and monthly payment amount across lenders.
How Do You Get A Car Loan If Your Credit Is Bad?
FAQ
What can you get with a 590 credit score?
|
Type of Credit
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Do You Qualify?
|
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Unsecured Credit Card
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YES
|
|
Home Loan
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YES (FHA Loan)
|
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Personal Loan
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MAYBE
|
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Auto Loan
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MAYBE
|
What is the lowest credit score to get a new car?
What credit score do you need to buy a 30k car?
Can I get approved for a new car with 580 credit score?
Is there a minimum credit score for a car loan?
While there’s no universal minimum credit score required for a car loan, your scores can significantly affect your ability to get approved for a loan and the loan terms.
Is 590 a good credit score?
As mentioned, credit scores within the 580-669 range are considered to be fair credit. While your credit score is below average, it isn’t in the realm of “bad credit” and shouldn’t necessarily prevent you from getting certain types of loans. With your 590 credit score, lenders will generally consider you to be a higher-risk borrower.
Can I get a car loan with a low credit score?
Terms may apply to offers listed on this page. Some loan types — like mortgages and personal loans — require a borrower to have a minimum credit score. Auto loans are different. It is possible to qualify for a car loan with any credit score, although the lower your credit score, the higher the interest rate you can expect to pay.
Can you finance a car with a 650 credit score?
Yes, it’s possible to get a car loan with a 650 credit score, although your rates might not be as good as those for an applicant with better credit. If you shop around and aren’t happy with the interest rates you’re quoted, you might consider working on your credit before taking out a loan.