What should my credit score be in order to get a good APR on a new vehicle?
I am looking to buy a small SUV sometime in the fall/winter but know that I need to improve my credit score in order to get a better APR than I have now. What credit score are most vehicle lenders looking for?
Auto finance is what I do for a living and auto loans are based on the following factors;
1. LTV (loan to value).
2. Term requested.
3. Age of vehicle.
4. Miles on vehicle.
5. Down payment amount.
6. Time on job.
7. Time at residence.
8. Monthly income before taxes.
9. Credit score/profile.
Depending on how the above are submitted to the lenders anyone with a score from 500 up can be approved with a decent rate.
As far as your question, 680 is the cut off for the best rate from Chrysler, anything below 640 is considered sub-prime.
Far more important then score is your credit profile. You need at least 3 credit card accounts (revolving) with balances below 30% of your credit limit and 2 cars, boats, homes, furniture or personal loans (installment) all with good long payment history’s for the best rates.
I look at credit all day and see people every month with 700 scores that can not buy cars because their score is made up of 1 credit card with a $500.00 limit paid 15-times and a couple of student loans.
While this profile generates a great score it doe’s not show the willingness or the ability to actually pay anybody.
