What is an Auto Loan Credit Score?
An auto loan credit score is the number that potential lenders would look at to help determine your credit worthiness, the higher the better in this case. It would also determine your interest rate on the loan for the vehicle you are seeking.
Your score is based on the contents of your credit report, which is why the two go hand-in-hand. A mathematical equation is applied to various aspects of your credit report, and a 3 digit number is then formulated to “score” your overall credit rating.
Is it the same a regular credit score?
Generally, yes, it’s the exact same thing. Potential lenders will usually pull your credit report along with your FICO score. The end result of your score can differ slightly depending on which bureau your lender obtained your credit report from. (Equifax, Experian or TransUnion), but all 3 should be roughly the same, so lenders will normally just pull your credit report and score from one of the credit reporting angencies, and move forward based on that information.
From my experience, auto lenders normally pull my Equifax credit report with my FICO score to determine the risk of lending to me. My FICO score is generally above 780 (which is an excellent credit score) so they are able to offer me their best interest rate on the loan.
If your score is in the 725 range, this will usually put you in the same “excellent” category as a score of 780. In most cases, a score of 700-725 would be considered “good”. However, if your score is below 700, you may not be approved for the best interest rates your lender has to offer, and you should probably work on increasing your credit score before obtaining a loan.
Pull your own Credit Report & Score
It’s always a very good idea to view your credit report and score before applying for an auto loan, or any other kind of loan for that matter. That way you can check for errors on your report, know first hand what your credit score is, and eliminate any surprises when you’re actually in the process of applying for the loan.
Did you know that you can access your own credit report and score without damaging your credit, and it won’t lower your credit score no matter how many times you do it? strong>Did you know that you can also get your credit report and credit score for free? Here’s how.