Yes, you can likely get a car loan with a 588 credit score, but it's considered "Fair" to "Poor" (below 580), meaning you'll face higher interest rates and stricter terms, requiring a larger down payment or a cosigner to get approved. Focus on lenders specializing in subprime loans, compare offers, get prequalified, and save for a significant down payment to improve your chances and lower costs.
Fair Credit (580 – 669)
Financing is still available, but often comes with higher interest rates or larger down payment requirements.
There isn't a specific credit score requirement for buying a car. Some buy here, pay here (BHPH) lenders even offer loans to borrowers with low or no credit scores. However, if you want to get the best rates and offers, you may need a credit score in the mid- to high-700s or 800s.
The 2-2-2 credit rule is a guideline for building strong credit, suggesting you should have two active credit accounts (like cards or loans) for at least two years, with consistent on-time payments for those two years, often with a minimum credit limit of $2,000 per account, to demonstrate financial responsibility to lenders, especially for mortgages. It's a benchmark to show you can handle credit well over time, reducing lender risk and improving approval odds for major loans.
If you want to increase your score, there are some things you can do, including:
580 to 669: Fair Credit Score
Individuals in this category are often considered “subprime” borrowers. Lenders may consider them higher-risk, and they may have trouble qualifying for new credit.
For most people, increasing a credit score by 100 points in a month isn't going to happen. But if you pay your bills on time, eliminate your consumer debt, don't run large balances on your cards and maintain a mix of both consumer and secured borrowing, an increase in your credit could happen within months.
The 15/3 credit card payment method is a strategy to potentially boost your credit score by making two payments per billing cycle: one about 15 days before your statement closes (to lower reported utilization) and another around 3 days before the payment due date (to cover the rest and avoid late fees), though its actual impact on credit scoring is debated. It works by keeping your reported balance lower when the card issuer reports to bureaus, but experts note the specific timing isn't magical, and focusing on the reporting date is key.
Both saving and debt repayment are critical for long-term financial health. An emergency fund should be established before aggressively paying off debt to protect against unexpected expenses. High-interest debt, such as credit cards or payday loans, often warrants faster repayment to save on interest.
A $25,000 car loan payment varies significantly but generally falls from around $400 to over $700 monthly, depending on the loan term (3-7 years), interest rate (APR), and if you have a down payment, with shorter terms and higher rates meaning higher payments, while longer terms or good credit (lower rates) reduce monthly costs. For example, a 5-year loan might be about $494/month, but a 3-year loan could be over $770/month, even with similar rates.
There isn't necessarily a minimum credit score needed to get a car loan since each lender has different requirements. But having a credit score above 660 can help you get a chance at better terms and interest rates. Some lenders we mention in this article accept applicants with 600 credit scores.
You can probably still get financing with a credit score under 500, but most likely you'd pay a very high interest rate. 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.
What actions you can take to boost your credit scores?
The two big credit scoring models used by auto lenders are FICO® Auto Score and Vantage. We're going to take at look at FICO® since it has long been the auto industry standard.
The 15/3 rule
For those who want to pay credit cards twice a month, the “15/3 rule” may be a good strategy. The 15/3 rule suggests making two payments during your billing cycle: one payment 15 days before the statement closing date and another payment three days before the closing date.