What credit score is needed to buy a car?
The average person can secure a car loan with a fair-to-low credit score, but you aren't likely to find a good deal. According to lenders, a low credit score equals high-risk, a factor that will affect the following:
The average person requires a loan to purchase a car. When your credit score is high, dealers may well provide favorable terms like zero-interest for 60 months. On the other hand, a low credit score practically always means settling for a higher rate, larger monthly payments, and additional costs over the life of the loan.
While you may plan to provide a down-payment on a new car, the dealership may require more from you to offset the risk suggested by a low credit score.
A perfect driving record won't save you from the damage of a bad credit score. Insurance companies assess risk for a living, and it's their job to determine your safety level based on past performance. Even though consumer research really doesn't explain the correlation between fiscal health and highway safety, insurance companies have noted that interesting phenomena. So, expect higher insurance premiums when your credit score dips too low.
The bottom line: You can probably buy a car with sub-par credit, but you'll lose thousands to higher prices and inflated premiums. Why waste money when credit repair is an option?