622 Credit Score
on Experian

What Kind of Auto
Loan Rates Will I Get?


I have a 622 credit score on Experian and I plan to purchase a new car. I don't have bad credit, just not enough credit.

I have been employed at the same company for over 27 years. Monthly income $1500. My last vehicle was purchased new 17 years ago, (it has 402,000 miles on it) , so its no longer listed on my credit report, it was paid in full.

My mortgage is paid in full with no lates. My Equifax report shows $227 monthly pmt on open installments and credit cards, My credit cards have low credit lines, and max balances, so this hurts. I'm trying to pay them down now.

Last year I made a purchase of $2300, and at that time had a 671 credit score, I have 2 inquiries. I do have one delinquency from 7 years ago which is due off my report in May of this year.

Based on this information can you advise me on what my credit union rate might be on a 622 credit score.

Thanks,
Ange


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Answer:

Hi Ange,

It is sort of tough to be real specific in this situation, because I'm not familiar with your local credit union auto loans program or their auto loan rates, the loan structure and the age and miles of the vehicle you are buying. You did give me quite a bit of information that does help though.

My best guess in your situation is that a credit union will certainly be your best option, because of your monthly income and thin credit file. Based on what my credit unions here in AZ offer I'd guess that your rate (if approved) would be in the 10-13% range.

Most traditional banks are going to have set minimum income requirements of $1,800 to $2,200 a month. Many credit unions will too, but there are also many that will still approve loans with a $1,500 monthly income.

Your job stability certainly helps and having a well paid mortgage is definitely a positive too. As long as they are not too strict with their monthly income requirements I'd think an approval should be easy.

Even if you do fall into the 10-13% range now, it should be fairly easy to refinance your auto loan with the same credit union once your 622 credit score goes back up to say, 680 or above. Car credit is some of the best credit to have!

One last thought, you'll probably only be able to finance $8,000-$12,000 as a first time buyer. This will vary depending on some of the things I mentioned above as well as what type of first time buyer program the credit union has.

Hope this helps and please don't hesitate to contact me if you have any further questions.

Justin

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