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The pandemic has had a huge impact on the finances and spending habits of consumers. it helped a lot save more money since WWII and convinced others to avoid public transit at all costs. These two phenomena cause a record number of Americans getting their hands on a new set of wheels.
The first step in most expensive purchases, including buying a new (or used) car, is often finding financing. As auto loans become more and more affordable to offset the high cost of cars right now, your loan terms and rates will vary based on your credit score. Fortunately, you can check your credit score before applying to see what type of loan you might qualify for.
VantageScore® and FICO® Scores are the two main scoring models that provide credit scores. Both rate consumers on a scale of 300 to 850, and auto lenders can use either to approve you for a new loan or a car rental. Knowing the widely used FICO 8 and 9 scores and VantageScore 3.0 and 4.0 won’t hurt, but there is a credit score designed just for auto lenders that is worth considering when looking to finance a car.
What credit score is used when buying a car
Different auto lenders check different credit scores, so you won’t be sure which one they will look at when determining your auto loan application. Your best bet, however, would be to check what is called an industry specific score.
FICO provides industry-specific scores that consumers can refer to when making certain purchases like a car or a house. (Check full list of FICO score versions for different financial products.) Much like a standard credit score, your industry specific score helps determine future loan terms and interest rates.
The FICO Auto Score takes into account your typical credit behaviors, but places more emphasis on how you’ve handled auto loan payments in the past. It takes into account such things as: Did you make your loan repayments consistently and on time? FICO Auto Scores range from 250 to 900 and have multiple versions including FICO Auto Scores 2, 4, 5 and 8. The easiest way to check all four FICO Auto Scores at the same time is to use the Watch Service. of the FICO credit.
Knowing your auto credit score can be helpful when financing a car as it can affect your loan terms and rates. Any increase in your interest rate can lead to a higher monthly payment and pay thousands of dollars more over the course of a loan.
How to check all versions of your FICO Auto Score
If you want to finance a car with an auto loan, subscribe to one of the FICO® Basic, Advanced or Premier credit monitoring services can help.
All three FICO Basic, Advanced and Premier plans provide access to 28 versions of your credit score so you can use it when applying for any type of credit, including auto loans, mortgages and credit cards . These three services will also alert you to potential fraud, such as opening a new loan in your name or a sharp increase in your credit card balance.
If all you want is multiple versions of your FICO score, sign up for Basic, the lowest level, to save more money each month. Learn more about the differences between each FICO credit monitoring service.
FICO® Basic, Advanced and Premier
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Cost
$ 19.95 to $ 39.95 per month
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Supervised credit bureaus
Experian for the Basic plan or Experian, Equifax and TransUnion for the Advanced and Premier plans
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Credit rating model used
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Dark web analysis
Yes, for the Advanced and Premier plans
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Identity assurance
Editorial note: Any opinions, analysis, criticism or recommendations expressed in this article are the sole responsibility of the editorial staff of Select and have not been reviewed, endorsed or otherwise approved by any third party.
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