My current experian credit score is 637. If i finance a car loan will it bring my score up?

Question

I just got approved for two department store cards and got rejected for one or two majors. I know the fact that the lenders are checking my credit affects the score but with the car loan will it bring the score down?

Answer 1

A car loan will only bring the score itself down if you do not make payments in a timely manner. Now having car dealers pull your credit each time you find a car you might like.. yes that will bring it down dramatically.
I had a car dealer pull my credit 13 times and it took me wayyyyyyy down. I was furious.

This will change your income ratio though as far as being approved for other things. If you have a car loan against your name then you will need to make sure you for the next loan you are making enough to cover both or they will reject it.

Answer 2

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Answer 3

Yes, most likely the car loan will bring down your score. Every time you request more credit, it goes down on your record. The fact you recently got 2 cards, and were rejected by 2 others (especially this part) have hurt your score. I would encourage you to wait a little while, if you can, allowing the recent pulling of your report to age some.

Think of it this way, you recently requested 4 loans of some sort (cards and whatnot) in fairly short order, and to the people looking at your report, this looks like desperation for credit. You also extended your available credit some, increasing your credit availability to your income (making some assumptions, but this is probably what creditors are thinking). Thus, you may get rejected for the car loan, hurting your score more, or if you are approved now, you will probably get a poor interest rate. So hold off on the car loan and any other applications to get yourself a better score and interest rate.

Answer 4

Each time you authorize a creditor to review your credit you get a little ding on your report. So take it easy when applying for credit cards. A credit score of 637 is fairly average both on the low side of average. You can mostly likely be approved for an auto loan but may have a slightly higher interest rate. Having the additional debt will affect your Debt Ratio which will in turn effect your credit score. As you make your payments on all your outstanding debt on time and in full you will improve your score.

Answer 5

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RE My current experian credit score is 637. If i finance a car loan will it bring my score up?

I just got approved for two department store cards and got rejected for one or two majors. I know the fact that the lenders are checking my credit affects the score but with the car loan will it bring the score down?

Answer 6

Not to sound like Im preaching, but it sounds like you may already be under some financial obligations that you can't handle. That is how you get a score like that most times. Try to find someone on Craigslist or Auto Trader that will sell you a used car first. If you can afford at the momen to pay 250 dollars and higher (which is a low new car payment). then you should be able to buy a cheap used car from a lot somewhere. Some used car lots will give a loan to a dog with a paw print for signage ) I would go that route. But, remember, if can afford a 5 or 6000 car. Look for cars in the 7 to 7500 dollar price range. NOONE expects you to pay what is asked, They expect to negotiate. Unless it's some rare vehicle.

Answer 7

The series of recent credit checks will bring your score down slightly, as will the credit check for the auto loan. After you begin paying off the auto loan, your score will rise.

If you miss payments, the score will be hurt, probably by more than having the loan would help, but if you pay the whole thing off on time, you're good to go.

Hope this helps!

Answer 8

the most important thing in credit is for the creditor to see that you make your payments on time financing a car loan might bring the score down for only few months but it is a good thing to do in the long run if you make payments on time make sure you get the best deal when you finance this might be a good place to start and good luck
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Answer 9

First, "income to debt" does NOT FIGURE INTO CREDIT.

If all you have is 2 CC's, a car loan would be great-- for your credit to improve, you need both revolving (CC's) and installment (loans).

That said, it might not go up immediately, but within 6 months if you are making steady payments, it will help immensely, and in a couple yeras you could be in the 700 range.

Answer 10

Short term = lower it

Long term = raise it

For the short term you will have a new debt and that will lower your score. However, if you make your payments on time, over the next few months your score will rise. Plus, as you make your payments your debt ratio will lower. Should be about 6 months for the effects of this to come in and your score will start to rise.

Good luck!