Is 675 a Good Credit Score to Buy a Car?

Credit scores are numerical summaries of an individual’s creditworthiness. Lenders use them to assess risk and determine the terms and availability of credit products, especially for large purchases. Understanding these scores is fundamental to navigating the lending landscape.

Understanding Credit Scores for Car Loans

A credit score summarizes an individual’s credit risk, used by lenders to predict repayment likelihood. Several factors contribute to its calculation.

Payment history, reflecting on-time bill payments, typically holds the most significant weight (35-40%) in a credit score. Credit utilization, or the amount of debt owed, is another substantial factor (around 30%). This considers how much of available credit is being used.

The length of one’s credit history, including the age of accounts, typically makes up around 15%. New credit applications and the types of credit used (such as a mix of installment and revolving accounts) also contribute to the score, each accounting for about 10%. Auto lenders use these scores to evaluate an applicant’s risk profile, influencing whether a loan is approved and the interest rate offered.

Credit scores are categorized into ranges. While exact ranges vary between FICO and VantageScore models, a FICO score of 670-739 and a VantageScore of 661-780 are generally considered “good.” Higher scores are “very good” or “excellent,” while lower scores are “fair” or “poor.” These categories help set expectations for loan terms and approval chances.

What a 675 Score Means for Auto Financing

A 675 credit score is generally considered a “good” score within both FICO and VantageScore models. This score indicates a responsible credit history, making approval for an auto loan likely from many lenders. While not the highest tier, it typically allows access to competitive interest rates and terms, though not always the absolute lowest rates available to those with exceptional credit.

As of Q1 2025, borrowers with a 675 score could expect average interest rates around 6.70% for new car loans and 9.06% for used car loans. These rates are significantly lower than those for lower credit scores, which can climb to 15% or higher for new cars and over 20% for used cars. The difference in interest rates can lead to substantial savings over the life of a loan.

While a 675 score makes loan approval probable, lenders might request a larger down payment or offer shorter loan terms to mitigate their risk. A 675 score generally means a borrower is seen as a moderate risk, which opens up more financing options compared to those with lower scores, including a wider selection of lenders and more favorable repayment schedules.

Steps Before Applying for a Car Loan

Before applying, check your credit report for accuracy. Consumers are entitled to a free annual copy from each of the three major credit bureaus. Reviewing this report allows you to identify and dispute any errors that could negatively impact your score, potentially improving your standing before applying.

Assess your budget to determine an affordable monthly car payment and a suitable down payment. A larger down payment can reduce the loan amount, potentially leading to lower monthly payments and less interest paid over time. This financial self-assessment helps to set realistic expectations for the car you can afford.

Gather necessary financial documents in advance. Lenders typically require proof of income (pay stubs, tax returns), proof of residence (utility bill, bank statement), a valid driver’s license, and proof of car insurance. Having these documents readily available can expedite the loan approval process.

Get pre-approved for a car loan from a bank or credit union before visiting a dealership. Pre-approval provides a firm loan offer for a specific amount, allowing you to understand your potential interest rate and terms in advance. This empowers you with negotiating leverage at the dealership.

Applying for and Securing Your Car Loan

Apply for a car loan directly through a bank, credit union, online lender, or dealership. Each option may offer different rates and terms, making it beneficial to compare offers.

The loan application process involves submitting the financial and personal information you gathered, including your Social Security number, employment details, and income. Lenders use this, along with your credit report, to make a credit decision. Most applicants can expect a decision within a few hours during normal business hours.

Once you receive loan offers, review and negotiate the terms, focusing on the interest rate and loan duration. A lower annual percentage rate (APR) reduces the total cost of borrowing, while a shorter loan term can save money on interest, though it typically results in higher monthly payments. After selecting the most suitable offer, you will sign the loan agreement.

After final approval and signing, funds are disbursed, typically with the lender paying the dealership directly or providing a check. Complete paperwork for vehicle title and registration, and provide proof of insurance before driving off with your new car.