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Posted in Auto Loans
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Question By
Euskadi79

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0 People Helped
Auto loan insanity!!
I am in that place in my life where I am secure in my career, no mortgage, no loans other than federal school loan debt which has never gone to default status, and one credit card that I just paid off in full. My credit score is around 718 and I desperately need a new car as I am still driving the same truck since college. I went to my bank to find out about financing options and was blown away by the interest rate average, they quoted me at 6-12% for a 72 month loan?? Any advice would be much appreciated!

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Top Contributor
229 Contributions
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Shop for it

Is it a new car or used car loan?  Loans on used cars will generally be higher by a few points, and right now new car loans are generally running about 2-3% for excelelnt credit. You have good (not excellent) so that sounds about right for a loan to buy a used car.

IF you are serious about getting a car, and have good income with your score, then shop around for rates. Your score will take a hit for a month as all people you allow to pull a credit score will show up, but once you make a buy all but one hard inquiry will go away. Dealing with a dealership they will typically have several banks compete for your loan, especially if you make that a point to them making a deal.

Just because you show a 718 here, realize that is NOT what the dealerships/banks will see.  Typically there will be up to a 40 point swing depending on what model they use.  My score is typically about 20-30 points lower dealing with auto, and about 30 higher when dealing with home loans.

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