Will a 540 Credit Score Get Me an Auto Loan?

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Q: I need to try for an auto loan over the next few weeks, though I only have a credit score of 540. Is that going to be enough to get a car loan, or is it going to be turned down everywhere I go?

A: With your credit score at 540 it is perfectly possible to successfully get an auto loan, although interest levels for these loans might be a little higher than average.

Experian said that vehicle loans for car buyers with scores of under 540 accounted for twenty percent of auto loans in 2019! Check down the page for any loans which might accept a 540 credit score and in addition ways of bettering your score.

With a credit score near to 540, you’ll have a fairly good chance of being approved for a car loan if you make an application for vehicle loans online. Taking this option means it’s easy to do a comparison of prices from a large choice of finance companies and you will be working with lenders who are a lot more accommodating in relation to authorising loans to borrowers with low credit. If you aren’t certain how to begin this process, examine our list of services.

Amounts
Up to $10,000
APR
Individual rates
Bad credit
Allowed
Loan Terms
3 months to 6 years
Amounts
Up to $5,000
APR
Individual rates
Bad credit
Allowed
Loan Terms
3 months to 3 years
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Exactly the same response applies to auto loans for those having a credit score of 541, 542, 543 and 544.

How to improve your credit score & interest rate

Although you could submit a successful application for an auto loan with a poor credit rating, the down side is that you’ll incur a much higher interest rate. You could qualify for a slightly more reasonable rate if you can put more money down on the car in question. Also you might try to raise your own FICO score.

Let us discuss a few techniques for perhaps maximizing your credit score before applying for an auto / car loan:

  • Credit cards, reduce your credit liability to below 30%.
  • Get up-to-date on as many bills and outstanding debts as is possible.
  • Get registered on Experian Boost to get your utilities and phone bill payments counted towards your credit scores.
  • Request your free credit reports, examine them for errors and contest any you discover.
  • Some loan providers are willing to excuse one-off issues and erase them from your record. See if this is relevant to your situation.