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Bad Credit Auto Loans and Credit Scores

Before applying for no credit auto loans there are some facts you should know about credit scores

Know the score

Before applying for a problem credit auto loan you should find out your credit score.

We’ve seen what can happen if you don’t after being involved in bad credit car sales for over nineteen years here at Auto Credit Express.

We also know that a tote the note loan won’t help you establish your auto credit and that you should be familiar with the bad credit auto loan process in order to reduce your chances of repossession.

But from the beginning you should know if you really need a problem credit auto loan.

To begin

To see where you stand credit-wise, you should order a credit report and credit score from each credit bureau (Equifax, Experian, and TransUnion). To order (you’re allowed one free report per year per bureau), go to www.annualcreditreport.com. You’ll need to pay each bureau to get your credit score.

To simplify the process, you can also visit a site such as www.FreeScore360.com. For a fee, you can receive all three reports and all three credit scores at the same time.

Now it’s time to interpret them.

Credit score types

All three bureaus use a version of the FICO score. Equifax calls it a BEACON score, Experian calls theirs the Experian/Fair Isaac Risk Model and at TransUnion it’s called an EMPIRICA score.

In addition, the three bureaus also share a new score that they jointly developed called VantageScore.

In a perfect world, all three FICO scores or VantageScore scores would be the same, but they aren’t. This is because the information that appears in each of your credit reports is not exactly the same.

The reasons for differences

Unless your credit file is fairly new, there are bound to be differences between your three credit reports. This is because:

1.    Some creditors report to only one or two of the bureaus.
2.    It may take one bureau longer to report a new creditor
3.    It may take one bureau longer to remove an old credit file
4.    One, two, or even all three bureaus may be reporting inaccurate or incomplete credit information

Any of these factors, plus others, can result in different credit scores. Car dealers also use an “auto enhanced” score that adds weight to your car loan history – which means the score they see could also be different.

Where you fit in

Now it’s time to see where your credit scores fit in and what kind of car loan you might qualify for.

Here is how one bureau, Experian, tiers the two types of credit scores:

Super prime:
FICO Score: 740 plus
VantageScore: 801-990

Prime:
FICO Score: 680-739
VantageScore: 701-800

Non-prime:
FICO Score: 620-679
VantageScore: 641-700

Subprime:
FICO Score: 550-619
VantageScore: 601-640

Deep subprime:
FICO Score: less than 550
VantageScore: 501-600

In the case of Experian, super prime is the best of the best, prime is excellent credit, near prime is fair credit. If you fall into either the subprime or deep subprime category you’ll probably need to apply for horrible credit auto loans.

The Bottom Line

By knowing your credit scores, you’ll know what type of loan you need to apply for.

If you have poor credit, Auto Credit Express can match you with a dealer than can help. These dealers are knowledgeable and will ensure you have your best chance at getting approved auto loans for a bad credit car.

So if you’re serious about getting your car credit back on track, you can begin by filling out our online car loans bad credit application now.

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