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Posted in Auto Loans
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1985600

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Thinking about a car loan... poor credit score
I have a discover credit card and one store-specific credit card. I make all of my payments on time and pay off all of my balance each month. My credit score is 634, probably just from a short credit history (I've only had my oldest card for about 4 months).
I am in desperate need of a new car. My current car is having troubles starting and is less than reliable, so I am hopefully trying to get a new car.
However, I am worried that I won't be able to get a good loan for a new/used car (looking around $12-15k).
Any suggestions for ways to improve my chances/good lenders that might be able to give a decent loan?

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Not going to lie to you, with a 634 score, you aren't going to get a prime rate on the car. You are probably looking at a rate somewhere between 10 and 20%. Cars direct has the following guideline for interest rates based on your score:

 

  • 850 - 740: Excellent credit score - 3.2% interest rate (on average)
  • 739 - 680: Average credit score - 4.5% interest rate (on average)
  • 680 and below: Sub-Prime credit score - 6.5 - 12.9% interest rate (on average)

You also may have to prepare yourself for the possibility that a new car might be out of the question and even tamper your expectations for what used car you get. 

Best of luck!

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