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A credit score of 708 falls right in the middle of the “good” credit range, but what does that mean when it comes to buying a car? Can you get approved for an auto loan and get a decent interest rate with a credit score of 708? Here’s what you need to know.
What Does a 708 Credit Score Mean?
A 708 credit score is considered good by most lenders Good credit scores generally fall between 670-739 on the FICO scale. This means lenders see borrowers with scores in this range as acceptable credit risks While you may not get the absolute lowest interest rates or the most favorable loan terms, a 708 credit score means lenders will likely approve you for a car loan.
According to myFICO, borrowers with good credit have a 9% risk of becoming seriously delinquent on future credit obligations. This is considerably lower than the risk for those with fair credit scores between 580-669 (27%) and poor credit scores under 580 (50%). So with a 708 score, lenders will view you as a relatively low-risk applicant compared to those with lower scores.
Can You Buy a Car With a 708 Credit Score?
Yes, you can absolutely buy a car if your credit score is 708. Here’s what you can expect during the car buying process with this credit score:
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Getting Approved Since a 708 credit score is in the prime range, you should have no problem getting approved for an auto loan from most lenders. Approval odds are very high.
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Interest Rates While you’ll likely get approved a 708 score may not get you the rock-bottom interest rates on a car loan. The best rates are usually reserved for borrowers with scores of 750+ in the excellent range. So your interest rate may be slightly higher than those with top tier scores.
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Loan Terms: Similar to interest rates, your loan terms probably won’t be as favorable as borrowers with excellent credit. For example, you may face a shorter loan term or higher monthly payments vs. those with higher scores.
Overall, a credit score of 708 is a good starting point for buying a car, even if your loan terms aren’t the absolute best. The key is to shop around for the most competitive rates and terms for your situation.
Strategies for Buying a Car With a 708 Credit Score
While a 708 credit score is considered good, here are some tips to make sure you get the best possible deal on your auto loan:
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Make a large down payment: Putting down 20% or more if possible can get you lower interest rates since you’re borrowing less.
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Try to improve your credit first: Boosting your score before applying for a loan may help you land better rates. Pay down debts, dispute errors, etc.
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Compare lenders: Don’t just finance where you buy the car. Compare offers from banks, credit unions, and online lenders.
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Consider a co-signer: Adding a co-signer with excellent credit can help you qualify for better loan terms.
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Get pre-approved: Being pre-approved can give you bargaining power when negotiating at the dealership.
What is a Good Credit Score for Buying a Car?
While every lender has their own standards, here are some general credit score guidelines for getting a competitive auto loan:
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Excellent Credit: 780+ – Expect loan approval and the very best interest rates on a car loan.
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Good Credit: 670-739 – Loan approval likely and decent interest rates, but not rock bottom.
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Fair Credit: 580-669 – Loan approval still possible but interest rates much higher.
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Poor Credit: Under 580 – Loan approval difficult, high rates, and unfavorable terms.
Again, every lender is different, but shooting for a score of 720+ before applying for a car loan can help ensure you get approved at a competitive rate. The higher your credit score, the better when it comes to auto financing.
How to Improve Your Credit Score Before Buying a Car
If your score is on the lower end of the good credit range, here are some tips to improve it before you apply for an auto loan:
- Pay all bills on time – payment history is the biggest factor in your scores.
- Pay down credit card and loan balances – this lowers your credit utilization.
- Avoid new credit applications in the months before applying for a car loan.
- Contact creditors to remove any errors on your credit reports.
- Become an authorized user on someone else’s credit card if they have excellent credit and low utilization. Their good history can help boost your scores.
Checking your credit reports and FICO scores before car shopping is highly recommended. This lets you see exactly where you stand and if you need to build your credit further in order to qualify for the best auto loan terms.
Can You Buy a Car With Bad Credit?
If your credit score is under 600 or considered poor, buying a car with bad credit is tough but still possible in many cases. Here are some bad credit car buying tips:
- Save up for a large down payment of 25-30% or more. This shows lenders you are committed even with poor credit.
- Explore special financing from dealerships or manufacturers for borrowers with poor credit.
- Consider a secured auto loan using collateral, or a co-signer with excellent credit to lower rates.
- Look for “second chance” financing from lenders like Credit Acceptance and Westlake Financial that offer car loans to subprime borrowers. Rates are higher but approval is easier.
- Buy an inexpensive used car you can afford to pay for in cash if financing isn’t an option.
While car buying with poor credit is certainly more challenging, focus on rebuilding your credit so you can qualify for an auto loan in the future. But if you need a car now, there are still options even with bad credit.
The Bottom Line
A credit score of 708 means lenders will likely approve you for a car loan, but your terms won’t be as good as borrowers with excellent credit. Improving your score before applying, making a large down payment, and shopping around for lenders can score you the best deal. While buying a car with bad credit under 600 is difficult, special bad credit financing programs do exist to help subprime borrowers. Knowing your credit scores and reports before starting the car buying process lets you see where you stand with lenders.
What credit score is needed to buy a car?
The average credit score was 748 for a new car and 684 for a used car, according to data from Experian.
There is no official minimum credit score required to buy a car, but most lenders have minimum standards for financing. Your credit score demonstrates your likelihood of repaying a loan, which is why it is one of the main tools lenders use when determining if you qualify for a car loan. Generally speaking, the higher your credit score, the more likely you are to be approved for an auto loan and receive a competitive interest rate.
This table illustrates loan risk distribution, which is the percentage of people in each credit band auto lenders chose to finance. You are much more likely to be approved for an auto loan with a score of 600 or above because lenders have low risk tolerance for borrowers.
| New car financing | Used car financing | All car financing | |
|---|---|---|---|
| Super prime (781-850) | 47.44% | 22.34% | 30.75% |
| Prime (661-780) | 35.62% | 35.26% | 35.38% |
| Nonprime (601-660) | 10.87% | 18.35% | 15.84% |
| Subprime (501-600) | 5.61% | 20.69% | 15.64% |
| Deep subprime (300-500) | 0.46% | 3.36% | 2.39% |
Those with credit scores under 500 accounted for just 2.39 percent of all auto loans in the first quarter of 2025. Scores between 501 and 660 fared better and accounted for over 30 percent of auto loan originations.
Auto loan interest rates by credit score
When you apply for a car loan, the average auto loan rate you receive will primarily be based on your credit score.
| Credit score | New cars | Used cars |
|---|---|---|
| Super prime (781-850) | 5.18% | 6.82% |
| Prime (661-780) | 6.70% | 9.06% |
| Nonprime (601-660) | 9.83% | 13.74% |
| Subprime (501-600) | 13.22% | 18.99% |
| Deep subprime (300-500) | 15.81% | 21.58% |
Borrowers in the super prime range are more likely to qualify for auto loans with below-average rates. That said, there are bad credit auto loans available, but the cost of financing a car may be significantly higher. Learn more:
What Credit Score Do Car Dealerships Use? (Which Credit Bureau Is Most Used for Auto Loans?)
FAQ
Is 708 a good credit score to buy a car?
According to Experian, a target credit score of 661 or above should get you a new-car loan with an annual percentage rate of around 6.70% or better, or a used-car loan around 9.06% or lower. Superprime: 781-850. 5.18%.
What is the minimum credit score to buy a car?
What credit score is needed for a $30,000 car loan?
What credit score is needed for a $20,000 car loan?
There is no minimum credit score required to buy a car, but most lenders have minimum requirements for financing. Most borrowers need a FICO score of at least 661 to get a competitive rate on an auto loan.