What Credit Score Do You Need To Buy a Car?

Written By
I. Mitic
July 04,2023

One would think that getting a car would be as easy as walking into a car dealership, swiping your card, or paying cash upfront, and driving out with your new wheels. While this may be the case for some people, in reality, financing a car is not a luxury everyone can afford.

In this article, you will read about what a credit score is and get an answer to the ultimate question, “What credit score do you need to buy a car?”

What Is a Credit Score?

A credit score is a number determined based on your credit history. It reflects your tendency to repay loans and make payments on time, based on past transactions.

Credit scores usually range between 300-850, with 300 being the minimum and 850 the max credit score. The higher your credit score, the higher your chances of getting a loan: It shows that you are reliable enough to be trusted with another loan.

Knowing your credit score helps you determine what you can afford and what you can improve. With that in mind, it’s no surprise that you want to ask what credit score do you need to buy a car, a house, or even a cell phone and how you can calculate it.

Having a decent credit score is considered necessary. Hence, a California-based company named Fair Isaac and Company (FICO) helps consumers learn their credit score, otherwise called a FICO score, by offering credit-scoring services. According to myfico.com, “FICO Scores are the industry standard for making accurate and fair decisions about creditworthiness. They help millions of people get the credit they need for a home, a new car, or a special purchase.”

Most importantly, FICO’s scoring models are accepted by most top lenders.

What Kind of Credit Score Do You Need To Buy a Car?

General credit scores are categorized into Bad (300 - 629), Fair (630 - 689), Good (690 - 719), and Excellent (720 - 850). However, FICO also has an auto-credit score range of 250 - 900, and getting a car loan depends on whether the car is new or used. As expected, the score required for a new car is higher than that required for a used one.

According to a survey by Experian, the average credit score needed for a used-car loan was 657, while that for a new car was 721. However, a few people could still finance a car with a credit score below 500.

If you’re wondering whether you could buy a car with bad credit, you should know that a low score puts you at the mercy of your lender. They will decide the amount, the duration of the loan, and the interest rate. Of course, these may not be favorable for you.

What Is the Minimum Credit Score To Get a Car Loan?

There is no official minimum credit score imposed on lenders, so this decision is left to their discretion. Some will be more concerned with your ability to pay back within the agreed time than others, so they’ll weigh different factors in your finances before considering you for a loan.

We can agree that the minimum credit score for a car loan varies from lender to lender and will ultimately depend on how much you suit them as a borrower.

What Are the Average Interest Rates Based on Credit Score Range?

On top of raising your likelihood of getting loans, having a high credit score also means you’ll get a lower interest rate than those with poorer credit.

For instance, with a score of 750+, your interest rate may be around 5.7%, while someone with a score of about 450 may pay an interest rate of 18.2%. This is just an example, not actual data.

However, Experian’s guide can help calculate auto-loan rates by credit score, so you’ll know the approximate interest rate to expect. It also lists the average car-loan interest rate by credit score for new and used vehicles.

Remember, other factors, such as the type of car you want to purchase and your location, can also influence the interest rate you’ll have to pay.

Below, you’ll find Experian’s table showing the average car loan interest rates according to credit scores. It can help you get an impression about what credit score do you need to buy a car and the Annual Percentage Rate (interest, plus additional fees) lenders will expect you to pay. It also shows the loan amount (for a new car only) by credit score tier, as well as the estimated monthly payment.

Credit Score Tier Average APR For New Car Average APR For Used Car Average Loan Amount (New Car) Average Monthly Payment (New Car)
Deep Subprime (300-500) 13.97% 20.67% $28,991 $562
Subprime (501 - 600) 11.33% 17.78% $32,284 $579
Nonprime (601 - 660) 7.14% 11.41% $36,912 $591
Prime (661 - 780) 4.21% 6.05% $37,866 $574
Superprime (781 - 850) 3.24% 4.08% $33,690 $541

What Credit Score Do You Need To Buy a Car With 0 Interest?

If you’re one of the lucky ones, you might be wondering if it’s possible to get a car and pay no interest. The good news is - yes, it is. The not-so-great news is, you’ll need lots of preparation and information to land a juicy deal that comes with zero interest. If you get it, though, you only need to pay the capital of your loan.

For starters, certain manufacturers offer deals where you won’t need to take care of the interest, as long as you meet their requirements. You should take the time to seek such manufactures out and learn the estimated credit score needed to buy a car from them.

It practically goes without saying that, to do this, you need to have a stellar credit record. First, you should evaluate your credit report properly and resolve any pending credit differences. That way, you’ll be on the good side of any dealership offering a zero interest rate. To get there, you can pay up any outstanding credit card balances, pay your bills before deadlines, etc.

Once you sort out all the credit discrepancies on your report, you need to consider the credit score you’re left with. You can then combine the lender info from earlier with your credit standing to determine what kind of credit score do you need to buy a car and avoid paying interest at a specific dealership.

Usually, lenders don’t disclose the exact qualifying score for an interest-free loan. However, Credit Karma reveals that people with credit scores of 700+ have the best chances of getting one.

While you might be eager to land an interest-free loan, we advise you to pay attention to the entire package. The dealer has to make money, so you might end up having to overcompensate in other areas just to qualify for the deal. After all, spending significantly more on the principal car payment would defeat the whole purpose of getting a zero-interest deal.

How to Buy a Car With Bad Credit

As much as we may all strive to have exceptional credit histories, it doesn’t happen for everyone, usually due to emergencies or unplanned circumstances.

However, you can still get a car or other assets with lousy credit, as long as you do what you can to improve your standing. Sometimes, even when you have a stable source of income and can afford to buy a car, a track record of debts and late payments may hinder your chances of getting loans when you really need them.

Below are some tips you can use to get an auto loan with a credit score below the standard:

  • Evaluate your credit report and sort out discrepancies where necessary.
  • Establish what you need in a car and plan towards getting one that aligns with that but stays within your budget.
  • Research different loan offers and, if possible, find a pre-approved loan.
  • Negotiate for a lower price.
  • Go over all the paperwork carefully to ensure that you fully understand what you’re getting into.
  • Complete your purchase with the best possible insurance plan.
  • Always make your payments on time to advance to a higher credit category.

If you keep all these in check, you are on your way to moving up the credit ladder.


What credit score is needed to buy a car without a cosigner?


There is no specific credit score for financing a vehicle without a cosigner. If you can pay upfront, you won’t need to take out a loan at all or check your credit records. However, having a higher credit score, especially upwards of 700, gives you more purchasing options since most lenders consider it a good credit score.

Can I get a car loan with a credit score of 600?


Yes, you can. However, both the principal and the interest rate may be higher than those you would get with a better credit score.

What is a decent credit score to buy a car?


While trying to provide an answer to the ultimate question: “What credit score do you need to buy a car?” we deduced that a credit score of 700 and above could be considered a decent credit score for buying a car with a fair interest rate and payment plan.

Can I get a car with a 500 credit score?


Although 500 is considered a bad credit score, reports from expert companies like Experian showed that a few people could still get their cars with credit scores of 500 and below. So, the answer is yes.

About author

For years, the clients I worked for were banks. That gave me an insider’s view of how banks and other institutions create financial products and services. Then I entered the world of journalism. Fortunly is the result of our fantastic team’s hard work. I use the knowledge I acquired as a bank copywriter to create valuable content that will help you make the best possible financial decisions.

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