Can I Still Finance a Vehicle with a Low Credit Score?
In short, yes, you can still finance a vehicle with less than ideal credit. It’s quite common, and many lenders work with people who have credit scores below “prime” levels. However, interest rates, terms, and requirements will vary based on your credit profile and the lender you choose. Below, we will go over how auto financing works with a lower credit score.
How Can I Finance With a Low Credit Score?
- Lenders look at your credit score to assess risk: Excellent/Good Credit: Lower interest rates, more options. Fair/Poor Credit: Higher interest rates, stricter terms. No Credit History: You may still qualify, but terms could be limited. Even with a score in the fair to poor range, many buyers still qualify for financing — you just might pay a higher annual percentage rate (APR).
- Lenders don’t just look at your credit score — they also consider: Income and employment history, monthly debt obligations (debt-to-income ratio), down payment amount, vehicle type and age, and the loan term length. A stable income and a larger down payment can improve your approval chances and loan terms.
How to Improve Your Chances of Financing
- Put down a bigger down payment — lowers the amount you need financed and reduces risk for the lender.
- Choose a shorter loan term — higher monthly payment, but lower interest overall.
- Have a co-signer with better credit — can improve approval odds and lower your rate.
- Check your credit report first — fix errors and improve your profile before applying.
Finance Today at Thelen Volkswagen in Michigan
No matter your credit score, Thelen Volkswagen in Bay City, Michigan, can assist you in finding the best Volkswagen model that fits your needs, wants, budget, and credit score! Our finance team will work to get you the lowest rates possible and a pay-off term that works comfortably with your individual budget. Give us a call at 989-402-5847 to start the purchasing process today!
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