While there is no set minimum credit score you need to purchase a car, your credit score will matter if you need to take out a loan. Lenders tend to appreciate borrowers with higher scores since they typically have a proven track record of managing their credit well, as reflected by their credit score. Borrowers with lower credit scores typically need more help getting a loan, and therefore require more stipulations for a lender to decide on.
Your credit is very important when you're trying to buy a car if you're financing, but it's not the end of the decision. Poor credit borrowers can have a chance at a car loan with bad credit as long as they meet other lending requirements. Let's take a look at what your credit score means for a car loan.
Minimum Credit Score for a Car Loan
Your FICO credit score is between 300 and 850. According to FICO, a borrower with a credit score above 670 indicates good creditworthiness. To a lender, your credit score is a major indicator of your ability to repay borrowed money on time, such as for auto loans. If your credit score is below this threshold, you may struggle to qualify for a car loan with a traditional lender. However, while the typical bad credit score is considered below 670, deals can crop up from time to time, which can give bad credit borrowers a chance.
Credit score requirements vary greatly by lender, so there's no national minimum credit score you need to get an auto loan. However, as a general rule, if you do have credit challenges, you may have an easier time qualifying for an auto loan with a subprime lender.
Credit Score Ranges for Auto Loans
There are multiple credit score ranges that lenders can use, depending on whether they look at your FICO Score or VantageScore. These are two proprietary systems used by the major credit bureaus in the U.S. Most lenders use FICO, and more specifically, your FICO Auto Score, if you have one. This score is more heavily weighted toward information from previous auto loans. So, if you've had a loan in the past and managed it well, you're likely to have a better FICO Auto score than someone who hasn't had an auto loan or has a mismanaged car loan in their past.
Both the FICO and VantageScore scales range from 300 to 850. Here's how Experian, one of the major credit bureaus, defines credit scores (using the VantageScore 4.0 scale):
- Super Prime: 781-850
- Prime: 661-780
- Nonprime: 601-660
- Subprime: 501-600
- Deep Subprime: 300-500
The minimum credit score for a car loan varies by lender and from person to person. Though most traditional lenders agree that 670 marks good credit, many captive lenders still finance borrowers who are considered bad credit borrowers. These borrowers may even get financed through some lenders, such as Kia Financial, with credit scores as low as 540. However, the cost of borrowing goes up the lower your credit score is, so be aware that you'll face a higher interest rate.
How Your Credit Score Affects Your Car Loan
Mostly, your credit score affects the interest rate you're approved for from a lender. The higher your credit score is, the lower interest rates you may qualify for. According to Experian's State of the Automotive Finance Market Report Q3 2025, current average interest rates can vary from 4.88% to 21.6% depending on your credit score and whether you're financing a new or used vehicle.
How Lenders Set Credit Score Requirements
Lender credit score requirements vary, but the method by which they evaluate your creditworthiness is usually the same. Lenders look at your credit history to see how you've handled loans and lines of credit in the past, look at how often you take on new credit, and look at other factors like your credit utilization ratio.
Your credit report shows a lender much of what they need, but many lenders, especially subprime lenders, know that there is more to a borrower than just a credit score. This is why lenders ask for stipulations such as proof of income, proof of residence, and your debt-to-income ratio.
Remember, even though lenders may evaluate you similarly, their scale for approval can vary widely, and ultimately, auto loan approval is at the lender's discretion.
Bad credit can impact your car loan chances, but once you get one through a subprime lender, a bad credit auto loan can be one of the best ways to improve your credit score. A car loan hits many different metrics that raise your score, such as payment history, new credit, and credit mix. Of course, you have to make all your payments on time and in full, and don't let your other bills slip, either, if you hope to raise your credit score.
A car loan is a great way to improve your credit, but it's just one way. You can also become an authorized user on someone's credit card, clean up your credit reports, and pay off outstanding debt, too. Additionally, you can make your current payments work for you by using a service like Experian Boost to get credit for things you already pay.
Get Prequalified Before Buying Your Car
Though pre-qualified and pre-approved sound very similar, they play very different roles in helping you to get into an auto loan. Pre-approved auto loans come from direct lenders such as banks, credit unions, and online lenders. They essentially turn you into a cash buyer at the dealership. When you visit the lender, you're approved for a certain amount of money, which is given to you in a check or sent directly to the dealer when you complete your purchase.
When you're pre-qualified for an auto loan, you're matched with a dealership based on specific requirements. Many dealers and lenders can work with borrowers who have less-than-perfect credit, but not all of them do. Using a pre-qualification, though, you can improve your chances of getting the right lender and avoid having your credit score hit over and over again.
A pre-qualification begins with a request for financing that saves dealerships and lenders time by getting the process started up front. When you're struggling with poor credit, it's important that you take care not to have your credit score pulled multiple times, stretched over weeks or months. Each credit pull generally dings your credit score around five to 15 points.
If you're pre-qualified, you're matched to a dealer based on the information you give. Getting matched with the right dealership that's signed up with the right lenders makes a world of difference when you're seeking a car loan approval.
