Auto Finance and your Credit ScoreWhen financing a vehicle you will need to know your credit scores and credit history report. Your credit scores and history report are not very useful though if you don't understand exactly what they mean. They can affect the cost of a lot of different things so hopefully this article will better prepare you to get guaranteed auto loans.
Lenders want to know this because they need to be aware of the possible risks of lending you money. They will look at your FICO scores which you have not only one but three. Each one represents one of the three main credit bureaus: Experian, TransUnion, and Equifax. These will affect such things as interest rates when applying for a loan.
You will have a credit report. This tells them all about your financial history. If you have been smart with your money then this should be fine. But if you haven't made the best decisions this might hurt you. They will always make sure to check this before even considering vehicle financing for you.
You will also have a credit score based off of your three FICO scores. This number will range from about 300-850 and the higher it is, then the better it is. The better it is will increase your chances of getting the desired loan or more if you have a great score. This is the biggest factor when the lender is deciding if you get approved and what your interest rate will be.
There are many ways to improve your credit scores if it is less than satisfactory. If it needs some work look into ways to raise your number then go apply for that auto financing loan. Just be prepared and hope that any poor choices won't come back to haunt you when applying.