If you have a low credit score, you may still qualify - but you should consider building your score before you start searching for loans.

Before you head to the dealership, consider how your credit score will affect how much you are able to spend. Lenders use your credit score as an indication of how likely you are to repay a loan. This means that the higher your credit score, the more favorable your interest rate and terms will be.

In general, you'll need a FICO credit score of at least 600 to qualify for a traditional auto loan, although there are lenders that offer bad credit auto loans. Because interest rates remain high, securing a subprime auto loan may be more difficult -- but not impossible, especially as experts hope for lower rates in 2025.

Experian data from 2024's third quarter shows that only 5.58 percent of new financing went to borrowers in the subprime or deep subprime category, with scores ranging between 300 and 600. Subprime and deep subprime borrowers looking for used cars fared much better, accounting for 20.75 percent of used financing.

If your credit score is below prime, you may need to look for a bad credit car loan. These typically have higher interest costs than traditional auto financing.

Although there is no official minimum credit score needed to buy a car, most lenders have minimum standards when it comes to financing. These standards range based on lender specifics and are present in order to ensure that borrowers are lending to those who can confidently pay back their loans.

Not all lenders use the same credit score reporting agencies as their source of truth. There are two main scoring systems you will encounter when searching for a loan: FICO score and VantageScore. Most lenders use FICO, which ranges from 300 to 850. VantageScore is less common but still ranges from 300 to 850. Both scores use a mix of your credit history, amount owed, balances and available credit -- just weighted differently.

Some auto lenders also use a version of the FICO score called FICO Auto Score. This type of scoring is focused specifically on your ability to pay back debts, and these scores range from 250 to 900.

It is possible for lenders to use a different type of credit scoring metric. If you are unsure, reach out to your prospective lender to determine what measure will be used.