Credit Tiers for Auto Loans Explained

Short Answer: Most auto companies — including Chrysler, GM, Ford, and Volkswagon — do not make information on their credit tiers for auto loans public. In fact, Toyota is the only car manufacturer we found that publishes its credit tiers. In general, to obtain the best possible auto loan rates, you’ll need a credit score in the mid-700s. For more details of credit tiers for auto loans, see below.

Credit Tiers for Auto Loans

Credit tiers determine the financing opportunities available to you when you purchase a car. Tiers vary by company, and auto brands do not generally make their credit tier information public.

We reached out to several auto companies, including GM, Chrysler, Ford, and Volkswagon, to ask about their credit tiers. We were told by each company that it does not share this type of information. Instead, we were advised to visit a local dealership and ask about individual financing options.

During our research, we found that the only car brand that publishes its credit tier system is Toyota.

Toyota Credit Tiers for Auto Loans

Toyota Financial Services lists specific credit tier information on its website, including the following breakdown using FICO credit scores:

  • Excellent: 720 and above
  • Great: 690 to 719
  • Very Good: 670 to 689
  • Good: 650 to 669
  • Fair: 630 to 649
  • Poor: 610 to 629
  • Very Poor: 580 to 609
  • Extremely Poor: 579 and below

If you have limited credit, Toyota Financial Services offers specific programs for qualified buyers.

General Credit Tiers

As with most things involving credit scores, the higher the better. A higher credit score will typically get you better rates on loans, including auto loans. And, while companies define their credit tiers differently, Experian splits its credit tiers this way (using FICO credit score):

  • Excellent: 800 to 850
  • Very Good: 740 to 799
  • Good: 670 to 739
  • Fair: 580 to 699
  • Very Poor: 300 to 579

Before applying for financing, it would be a good idea to look over your credit report and remove any errors. Each year, you can obtain a free copy of each of your credit reports through AnnualCreditReport.com. Mistakes happen and they can lower your score enough that you fall into a lower tier. If you spot an error, you’ll need to reach out to the credit reporting bureau with supporting documentation to have it removed. FICO offers guidelines for this process on its website.

How to Get the Best Auto Loan Rate

Though credit tiers for auto loans can vary significantly, there are a few general guidelines that can help you get the best possible rate.

First, understand that you will likely need to have a credit score in the mid-700s to land the best rates in the top tier. Car brands set the minimum boundary for their top credit tier differently, but none of them will be lower than 740 or 750. If your credit score matches that number or is higher, you can expect to receive the best rates available.

Second, if you find that you fall just below a credit tier, ask the dealer if you can be bumped up. Sometimes finance departments can grant such a request, especially if you’re able to provide evidence of regular on-time payments.

Finally, if you aren’t satisfied with the rate a dealership offers you, consider financing through a bank or credit union. Bank loans can offer more competitive rates than a dealership, which means you could end up with a lower payment each month.

More Information

Looking for more auto loan options? See our related article on “we tote the note” car lots.

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