There is no minimum credit score required to buy a car, but most lenders have minimum requirements for financing. Most borrowers need a FICO score of at least 600 to get a competitive rate on an auto loan.
With a 650 credit score, you're right on the edge of getting favorable car loan terms. The majority of loans with this credit rating will require a down payment. Moreover, they will also more than likely come with a term of 48 months (or possibly even longer).
You will need a credit score of 580 or higher to get a $30,000 personal loan in most cases, along with enough income to afford the monthly bill payments. Other common loan requirements include being at least 18 years old, being a U.S. citizen or a permanent resident, and having a valid bank account.
A borrower with a 650 credit score and a $20,000 five-year used-car loan would have monthly payments of about $466 and pay $7,965 in interest over the life of the loan. Someone with a 500 credit score and the same loan would have monthly payments of about $547 and pay $12,836 in interest.
The required credit score for a $20,000 personal loan will vary from lender to lender, but a score of at least 650 will typically land you a decent interest rate and reasonably good repayment terms. Check with different lenders to find out their credit score requirements.
According to Car and Driver, “Most used auto loans go to borrowers with minimum credit scores of at least 675. For new auto loans, most borrowers have scores of around 730. The minimum credit score needed for a new car may be around 600, but those with excellent credit often get lower rates and lower monthly payments.”
Finding a car loan with bad credit is possible, but this type of loan will usually have high interest rates. Taking some time to build your credit may help increase your chances of approval and reduce loan costs.
Fair (650-699): A fair credit score may result in higher interest rates, but borrowers can still obtain financing without too much difficulty. Poor (600-649): Borrowers with poor credit may face limited financing options and higher interest rates.
You can borrow as much as $40,000 - $100,000+ with a 650 credit score. The exact amount of money you will get depends on other factors besides your credit score, such as your income, your employment status, the type of loan you get, and even the lender.
It's total loan amount (including interest) divided by the loan term (number of months you have to repay the loan. For example, the total interest for a $30,000, 60-month loan at 7% would be $6,497.40. So the monthly payment would be $608.29 ($30,000 + $6,497.40 ÷ 60 = $552.50).
If you have a 650 credit score you may be eligible for a loan but you might not get a favorable interest rate yet. With a credit rating of 600 to 650, the interest rate can be as high as 25-30%. In that case, you must make a down payment of at least 20% of the total amount.
However, this varies by lender, and the larger the down payment you can make, the better. As a general rule of thumb, it's recommended that you put down at least 20% on a new vehicle, and at least 10% on a used car. Depending on the car's selling price, this could mean shelling out quite a bit of cash.
A 650 credit score is generally considered “fair.” A score in this range may limit you from certain financial opportunities. Payment history, monitoring your credit and lowering your credit utilization ratio can be helpful ways to improve this score over time.
You can get a $30,000 personal loan from banks, credit unions, online lenders and peer-to-peer lenders. Eligibility requirements vary by lender, but for a loan this size, you'll likely need a good credit score and a high enough income to qualify for the best rates. Prequalifying is key to finding the best offer.
For example, the interest on a $30,000, 36-month loan at 6% is $2,856. The same loan ($30,000 at 6%) paid back over 72 months would cost $5,797 in interest. Even small changes in your rate can impact how much total interest amount you pay overall.
There isn't one specific score that's required to buy a car because lenders have different standards. However, the vast majority of borrowers have scores of 661 or higher.
What is the highest credit score possible? To start off: No, it's not possible to have a 900 credit score in the United States. In some countries that use other models, like Canada, people could have a score of 900. The current scoring models in the U.S. have a maximum of 850.
The short answer is yes, but you're likely to get a significantly higher-than-average interest rate. To put it into perspective, 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.