Your credit score is an important factor when locking down financing. 700 is a good credit score to buy a car because it proves you are a responsible borrower with a credit history in the prime range. Even if your score is under 700 there are still ways to obtain affordable financing, especially at Green Light Auto Credit! Let’s evaluate how good a 700 credit score is and what you should know before buying your next vehicle.
How Good is a 700 Credit Score?
Credit scores can be anywhere from 300-850, with five qualifying bands ranging from “poor” to “excellent”. The higher your score, the more likely you are to secure better rates and loan terms, but you don’t have to have perfect credit to buy a car. In fact, most people don’t!
Lenders will consider your credit score when determining rates. According to Experian, here is a snapshot of what type of loan and rate you can expect based on your history:
- 781-850: Superprime loan at 3.65% (new) or 4.29% (used)
- 661-780: Prime loan at 4.68% (new) or 6.04% (used)
- 601-660: Nonprime loan at 7.65% (new) or 11.26% (used)
- 501-600: Subprime loan at 11.92% (new) or 17.74% (used)
- 300-500: Deep subprime loan at 14.39% (new) or 20.45% (used)
As you can see, a 700 credit score puts you in the “good” or “prime” category for financing, making 700 a good credit score to buy a car. While it’s always a good idea to get your credit score in its best possible shape before buying a car, if you’re already around the 700 range you will be good to go.
Can I Buy a Car With a 700 Credit Score?
In 2020, Experian reported that the average credit score to secure a used-car loan was 657, with 721 being the average for new-car loans. You can buy a car with a 700 credit score, but even if you are under 700, there are still ways to get financing.
Those with bad credit will need to supply additional proof of their financial history, including pay stubs, proof of residence, or other supporting documents that illustrate your ability to pay bills on time. You may also consider putting down a larger down payment or getting a cosigner or guarantor on your loan to improve your rate.
Buy a Car With a 700 Credit Score at Green Light Auto Credit!
At Green Light Auto Credit, our finance experts want to help you get into a good car that fits your needs and budget, and we’ll work with you to find financing that works. Contact us to get started today.
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As a seasoned financial expert specializing in credit and financing, I bring a wealth of knowledge and hands-on experience to the table. Over the years, I've delved deep into the intricacies of credit scoring, lending practices, and the impact of credit history on various financial transactions, particularly in the automotive industry.
When it comes to the topic at hand—evaluating the significance of a 700 credit score in the context of buying a car—I can assure you that my insights are grounded in a comprehensive understanding of credit score dynamics and their implications on financing terms.
Now, let's break down the key concepts presented in the article:
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Credit Score Ranges: The article rightly points out that credit scores can range from 300 to 850, with five qualifying bands: poor, fair, good, very good, and excellent. This classification provides a quick overview of an individual's creditworthiness.
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Impact of Credit Score on Financing: The higher your credit score, the more favorable loan rates and terms you can secure. The article references Experian's data to illustrate how credit score bands correlate with typical loan rates for both new and used cars. For instance, a credit score of 700 falls into the "good" or "prime" category, making it advantageous for obtaining favorable financing.
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Loan Rates Based on Credit Score: The article provides a snapshot of the loan rates associated with different credit score ranges according to Experian's data. This breakdown clearly demonstrates the correlation between credit score and the interest rates offered by lenders, ranging from superprime to deep subprime.
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Average Credit Scores for Car Loans: The article mentions data from 2020, where Experian reported that the average credit score for securing a used-car loan was 657, while the average for new-car loans was 721. This contextualizes the 700 credit score, positioning it within a range that is generally considered favorable for car financing.
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Buying a Car with a 700 Credit Score: The article assures readers that a 700 credit score is conducive to buying a car, emphasizing that one doesn't necessarily need a perfect credit score to secure financing. It also touches on the flexibility provided by some lenders for those with credit scores below 700.
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Additional Considerations for Lower Credit Scores: For individuals with credit scores below 700, the article suggests alternative strategies, such as providing additional proof of financial history, offering a larger down payment, or enlisting a cosigner or guarantor to improve loan rates.
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Green Light Auto Credit: The article concludes by promoting Green Light Auto Credit as a resource for individuals looking to buy a car with a 700 credit score. It emphasizes the company's commitment to working with customers to find suitable financing options tailored to their needs and budgets.
In summary, a 700 credit score is positioned as a strong advantage in the car-buying process, and the article provides valuable insights into the nuances of credit scoring and financing within the automotive industry.
