When seeking a car loan, a credit score of 620 can be a pivotal factor in determining your eligibility and the terms you may receive. While this score falls within the range considered subprime, it is not an insurmountable barrier. Understanding how a 620 credit score influences various aspects of the auto loan process can empower borrowers to make informed decisions. This article delves into the nuances of obtaining a car loan with a 620 credit score, exploring types of loans available, potential interest rates, and strategies for improving creditworthiness. By equipping yourself with this knowledge, you can navigate the car financing landscape more effectively, ensuring that you secure the best possible deal.

What is a 620 credit score?

A 620 credit score is generally classified as a subprime score, indicating a higher risk for lenders. It is a reflection of your creditworthiness based on your credit history and financial behavior.

Definition of Credit Score

A credit score is a numerical representation of an individual’s creditworthiness, typically ranging from 300 to 850. It is calculated based on various factors, including payment history, amounts owed, length of credit history, new credit, and types of credit used. A score of 620 suggests that while you may have had some financial challenges, you are not a total credit risk, allowing for some borrowing opportunities.

Credit Score Ranges

Credit scores are categorized into ranges that help lenders determine risk levels. Generally, scores are classified as follows: 300-579 (poor), 580-669 (fair), 670-739 (good), 740-799 (very good), and 800-850 (excellent). A 620 score falls into the fair category, which can limit loan options but still provides some access to credit.

Importance of Credit Score

Your credit score plays a crucial role in financial decisions, influencing loan approvals, interest rates, and insurance premiums. Lenders use this score to gauge the likelihood of repayment. Understanding its significance can motivate individuals to improve their scores and enhance their financial prospects.

How does a 620 credit score affect car loan eligibility?

A 620 credit score can make securing a car loan more challenging, but it is not impossible. Lenders typically view this score as a signal of higher risk, which can lead to stricter eligibility criteria.

Lenders’ Criteria

Each lender has its own criteria for assessing loan applications, but many consider credit scores as a primary factor. A lender may require additional documentation or impose stricter income requirements for borrowers with a 620 score. This can include higher down payments or proof of stable income to offset perceived risks.

Minimum Credit Score Requirements

While some lenders may set their minimum credit score for auto loans at 640 or higher, others may be willing to work with borrowers at a 620 score. It’s essential to research different lenders, as some specialize in working with individuals who have lower credit scores, offering tailored products and services.

Impact on Approval Rates

Approval rates for auto loans decrease significantly as credit scores dip below 700. For borrowers with a 620 score, the approval process can be more rigorous, potentially leading to higher denial rates. Understanding this can help borrowers better prepare for the application process and explore alternative financing options.

What types of car loans are available for a 620 credit score?

Borrowers with a 620 credit score have several car loan options available, though they may vary in terms and conditions. Understanding these options can help borrowers make informed choices that best fit their financial situation.

Traditional Auto Loans

Traditional auto loans are offered by banks and credit unions, typically requiring a higher credit score for favorable terms. However, some lenders may provide loans to individuals with a 620 score, though the terms may include higher interest rates and down payment requirements. It’s crucial to compare multiple lenders to find the best deal.

Subprime Auto Loans

Subprime auto loans are specifically designed for borrowers with lower credit scores. These loans tend to come with higher interest rates and may require larger down payments to mitigate lender risk. While they can provide an opportunity for car ownership, borrowers should be cautious of the long-term financial implications.

Buy Here Pay Here Options

Buy Here Pay Here (BHPH) dealerships provide financing directly to consumers, often bypassing traditional credit checks. While this can be a viable option for those with a 620 score, it’s essential to be wary of high prices and unfavorable loan terms that may accompany these arrangements.

What interest rates can you expect with a 620 credit score?

Interest rates for car loans with a 620 credit score can be significantly higher than those for borrowers with better credit. Understanding this can help you prepare for the financial implications of your loan.

Average Interest Rates

The average interest rate for borrowers with a 620 credit score typically ranges from 10% to 15%. These rates can vary based on market conditions and individual lender policies. Borrowers should anticipate higher rates than those with good or excellent credit scores, which often see rates below 6%.

Comparison with Higher Scores

Borrowers with credit scores above 700 can secure interest rates as low as 4% or 5%. This stark contrast highlights the financial burden that comes with a lower credit score, which can lead to higher overall loan costs over time. Understanding this can motivate borrowers to improve their credit scores before applying for loans.

Factors Influencing Rates

Several factors influence the interest rates on car loans, including the lender’s policies, the borrower’s income, and the overall economic environment. Additionally, the type of loan and the vehicle’s age and value can also affect the rate offered. Awareness of these factors can empower borrowers to negotiate better terms.

What are the potential loan amounts for a 620 credit score?

The potential loan amounts available to borrowers with a 620 credit score may be limited due to perceived risk by lenders. However, borrowers can still find options that suit their needs.

Maximum Loan Amounts

Maximum loan amounts for a 620 credit score often depend on the lender’s policies and the borrower’s income. While some lenders may approve loans up to $30,000, others may cap it lower, especially for used vehicles. Understanding these limits can help borrowers set realistic expectations when shopping for a car.

Down Payment Considerations

Down payments play a crucial role in the loan approval process, especially for those with lower credit scores. A larger down payment can help secure a higher loan amount and may result in more favorable terms. Borrowers should aim to save up for a substantial down payment to improve their financing options.

Vehicle Value Limits

The value of the vehicle being financed can directly impact the loan amount. Lenders typically assess the vehicle’s value through resources like the Kelley Blue Book. Understanding how the vehicle’s value affects loan eligibility can guide borrowers in their purchasing decisions.

What are the terms and conditions for car loans at this credit score?

Loan terms and conditions for borrowers with a 620 credit score can be less favorable than those for higher-scoring individuals. Being aware of these terms can help borrowers navigate their options more effectively.

Typical Loan Terms

Typical loan terms for borrowers with a 620 credit score range from 36 to 72 months, though longer terms may be available. Shorter loan terms often come with higher monthly payments but lower overall interest costs, while longer terms may seem more affordable but can result in paying more interest over time.

Early Payment Penalties

Some lenders impose early payment penalties on car loans, which can discourage borrowers from paying off their loans early. It is essential to clarify these terms before signing any agreements to avoid unexpected fees. Understanding such penalties can help borrowers make smarter financial decisions.

Fees and Charges

Additional fees and charges may be associated with car loans for borrowers with lower credit scores, including origination fees, processing fees, and higher insurance costs. Being aware of these potential additional costs can help borrowers budget more effectively for their loan and avoid financial strain.

How can you improve a 620 credit score before applying for a loan?

Improving a 620 credit score before applying for a car loan can lead to better loan terms and conditions. Implementing specific strategies can enhance your creditworthiness and increase your chances of approval.

Paying Off Existing Debt

Reducing existing debt is one of the most effective ways to improve your credit score. Focus on paying down credit cards and loans, as lower debt levels can positively impact your score. This proactive approach signals to lenders that you are a responsible borrower.

Making Payments on Time

Consistently making payments on time is crucial for improving your credit score. Late payments can significantly damage your credit, so setting up automatic payments or reminders can help ensure that you stay on track. This habit not only improves your score but also builds trust with future lenders.

Reducing Credit Utilization

Credit utilization, or the ratio of your credit card balances to credit limits, plays a significant role in your credit score. Aim to keep your utilization below 30% to enhance your creditworthiness. Reducing credit card balances and avoiding new charges can help achieve this goal.

Are there alternatives to traditional auto loans for those with a 620 credit score?

Borrowers with a 620 credit score may seek alternatives to traditional auto loans that can provide more favorable terms or options. Exploring these alternatives can open new pathways to car ownership.

Peer-to-Peer Lending

Peer-to-peer lending platforms connect borrowers with individual investors willing to fund loans. These platforms often have more flexible criteria than traditional banks, making them a viable option for those with lower credit scores. However, borrowers should carefully review the terms and interest rates before proceeding.

Credit Unions

Credit unions often offer competitive rates and terms for auto loans, especially for members with lower credit scores. Joining a credit union may provide access to better loan options, as they tend to be more community-focused and willing to work with individuals who have less-than-perfect credit.

Personal Loans

Personal loans can serve as an alternative way to finance a vehicle purchase. While these loans may come with higher interest rates for borrowers with a 620 score, they can provide the flexibility of using the funds for a car purchase without being tied to a traditional auto loan. It’s important to shop around for the best terms.

What documentation is required to apply for a car loan with a 620 credit score?

Applying for a car loan with a 620 credit score requires specific documentation to demonstrate your financial stability and ability to repay the loan. Having the right documents ready can streamline the application process.

Proof of Income

Proof of income is critical for lenders to assess your ability to make monthly payments. This may include pay stubs, tax returns, or bank statements. Ensuring you have up-to-date documentation can enhance your credibility as a borrower.

Credit History Report

A credit history report provides lenders with an overview of your creditworthiness. While lenders typically pull this report themselves, being aware of your credit history can help you address any errors or discrepancies that could negatively impact your application.

Identification Documents

Identification documents, such as a government-issued ID, Social Security number, and proof of residence, are often required during the application process. Having these documents readily available can help expedite the loan approval process.

Can you negotiate terms with lenders if you have a 620 credit score?

Yes, negotiating terms with lenders is possible even with a 620 credit score. Being informed and prepared can improve your chances of securing better loan conditions.

Negotiating Interest Rates

While a 620 credit score may lead to higher initial interest rates, borrowers can negotiate these rates by presenting a strong case, such as proof of stable income or a significant down payment. Many lenders are open to discussions, especially if you demonstrate financial responsibility.

Discussing Fees

Fees associated with car loans can often be negotiated as well. Borrowers should inquire about any origination or processing fees and see if the lender is willing to waive or reduce them. Understanding these charges can lead to a more favorable loan agreement.

Loan Terms Flexibility

Loan terms, including the length of the loan and payment schedules, may also be negotiable. Borrowers should assess their financial capabilities and express preferences to the lender. Flexibility in these terms can help tailor the loan to better fit individual needs.

What should you consider when choosing a lender with a 620 credit score?

Choosing the right lender is crucial for borrowers with a 620 credit score. Several factors can influence this decision, impacting the overall loan experience.

Reputation of the Lender

The lender’s reputation is essential when choosing a financing partner. Researching online reviews and seeking recommendations from friends or family can help identify reputable lenders who are known for working with borrowers with lower credit scores. A trustworthy lender can offer a more supportive experience throughout the loan process.

Loan Offers Comparison

Comparing loan offers from multiple lenders is vital for securing the best deal. Look at interest rates, fees, and repayment terms to determine the most favorable option. Utilizing online comparison tools can simplify this process and ensure you make an informed decision.

Customer Service

Good customer service can significantly impact your borrowing experience. Consider lenders that provide clear communication, prompt responses, and assistance throughout the application process. A supportive lender can make navigating the complexities of car financing much easier.

What are the risks of taking a car loan with a 620 credit score?

While securing a car loan with a 620 credit score is possible, it comes with inherent risks that borrowers should be aware of before proceeding.

High-Interest Rates

One of the primary risks associated with a 620 credit score is the likelihood of high-interest rates. These rates can significantly increase the overall cost of the loan, leading to financial strain over time. Borrowers must be prepared for the potential long-term financial implications of high rates.

Loan Default Risks

Borrowers with lower credit scores face a higher risk of defaulting on loans due to financial strain. Missing payments can lead to repossession of the vehicle and further damage to your credit score. It’s crucial for borrowers to only take on loans they can realistically afford to repay.

Impact on Future Credit

Taking on a car loan with a 620 credit score can affect future credit opportunities. If you struggle to make payments, it may result in a lower credit score, complicating future borrowing needs. Understanding this relationship can help borrowers make more strategic financial decisions.

How does a 620 credit score compare to other scores for auto loans?

A 620 credit score is on the lower end of the credit spectrum, and its impact on auto loans is significantly different compared to higher scores. Understanding these comparisons can help borrowers appreciate their position.

Comparison with 580 Credit Score

A 580 credit score is generally considered poor, making it even more challenging to secure a car loan compared to a 620 score. Borrowers with a 580 score may face higher interest rates and fewer loan options, illustrating the importance of even slight improvements in credit scores.

Comparison with 700+ Credit Score

Consumers with credit scores of 700 or higher can access a wide range of favorable loan options, often securing lower interest rates and more flexible terms. This stark contrast highlights how a higher score can significantly affect borrowing capacity and financial outcomes.

Impact on Loan Terms

The credit score directly influences loan terms such as interest rates, down payments, and repayment periods. A higher score typically results in better terms, whereas a 620 score may lead to higher rates and stricter conditions. Awareness of this impact can guide borrowers towards improving their credit scores before applying for loans.

What is the process of getting a car loan with a 620 credit score?

The process of obtaining a car loan with a 620 credit score involves several key steps, each of which is essential for securing the best terms available.

Pre-Approval Steps

Before shopping for a vehicle, seeking pre-approval for a car loan can provide a clearer picture of your budget and loan options. Pre-approval involves submitting a loan application to a lender, who will evaluate your creditworthiness and provide a conditional loan offer based on your financial profile. This process can streamline negotiations when you find the right vehicle.

Application Process

The application process for a car loan typically requires completing a detailed form, providing necessary documentation, and undergoing a credit check. Lenders will assess your financial history and capacity to repay the loan. Being organized and prepared can help expedite this process and improve your chances of approval.

Finalizing the Loan

Once approved, borrowers will need to finalize the loan by reviewing and signing the loan agreement. It is crucial to understand all terms, including interest rates, payment schedules, and any fees associated with the loan. Taking the time to review these details can prevent future misunderstandings and financial challenges.

What common mistakes should you avoid when applying for a loan?

Avoiding common mistakes can enhance your chances of securing a car loan with a 620 credit score. Awareness of these pitfalls can lead to a smoother borrowing experience.

Not Checking Credit Reports

Failing to check your credit report before applying for a loan is a common mistake. Understanding your credit history allows you to identify and address errors that could negatively impact your score. Regularly monitoring your credit can equip you with the knowledge needed to improve your borrowing chances.

Ignoring Pre-Approval Options

Many borrowers overlook the benefits of pre-approval, which can provide insights into loan amounts and interest rates. Skipping this step can lead to confusion and limit negotiating power during the vehicle purchase process. Pre-approval can simplify your search for a vehicle within your budget.

Overlooking Loan Terms

Not thoroughly reviewing loan terms can lead to undesirable conditions. Borrowers should pay attention to interest rates, payment schedules, and any associated fees before signing on the dotted line. Understanding these terms can mitigate potential financial difficulties down the road.

What financial calculators can help with car loans?

Utilizing financial calculators can significantly aid borrowers in understanding their potential car loan obligations. These tools can provide valuable insights into budgeting and financial planning.

Loan Payment Calculator

A loan payment calculator allows borrowers to estimate monthly payments based on loan amounts, interest rates, and repayment terms. This tool can help you understand how different variables affect your monthly obligations, enabling better financial planning.

Affordability Calculator

An affordability calculator can help you determine how much car you can realistically afford based on your income and existing financial obligations. This tool ensures you make informed decisions when shopping for a vehicle, preventing overextending your budget.

Interest Rate Calculator

Interest rate calculators can help borrowers compare different loan offers. By inputting various rates and terms, you can see how these factors influence the total cost of the loan over time. This transparency can empower you to choose the most favorable financing option.

How can you budget for a car loan with a 620 credit score?

Creating a budget for a car loan with a 620 credit score requires careful planning and consideration of all associated costs. A well-structured budget can enhance financial security and ensure timely payments.

Monthly Budgeting Tips

When budgeting for a car loan, start by evaluating your monthly income and expenses. Allocate a specific portion of your budget for car payments, insurance, fuel, and maintenance. Maintaining a detailed budget can help you avoid financial strain and prepare for any unexpected costs.

Including Insurance Costs

Auto insurance costs should be factored into your car loan budget, as they can significantly impact your overall expenses. Research insurance rates based on the vehicle you plan to purchase and include these estimates in your monthly budget. Understanding these costs upfront can prevent financial surprises.

Maintenance and Fuel Costs

In addition to loan payments and insurance, consider ongoing maintenance and fuel costs when budgeting for a car loan. Regular maintenance can prevent costly repairs, and knowing your vehicle’s fuel efficiency can help you estimate monthly fuel expenses. Including these costs in your budget ensures you are financially prepared for car ownership.

What are the best cars to consider for a 620 credit score borrower?

Choosing the right vehicle is essential for borrowers with a 620 credit score. Selecting affordable, reliable cars can help ease the financial burden of car payments.

Affordable Models

When selecting a vehicle, look for affordable models that fit your budget. Compact cars often provide lower purchase prices and better fuel efficiency, making them ideal for budget-conscious borrowers. Examples include the Honda Civic, Toyota Corolla, and Ford Fiesta.

Reliable Brands

Reliability is crucial when choosing a car, as it can impact long-term ownership costs. Brands known for their reliability, such as Toyota, Honda, and Subaru, often have lower maintenance costs and longer lifespans. Selecting a reliable vehicle can enhance your financial stability over time.

Resale Value Considerations

Considering a vehicle’s resale value is essential, as it can impact your long-term financial position. Cars with strong resale values, such as the Toyota Camry or Honda CR-V, can provide better financial returns if you choose to sell or trade-in the vehicle in the future. This foresight can help mitigate the financial risks associated with car loans.

How can having a co-signer help with a 620 credit score?

Having a co-signer can significantly enhance your chances of securing a car loan with a 620 credit score. This arrangement can provide additional financial security for lenders.

Benefits of a Co-Signer

A co-signer with a strong credit score can improve your loan application by reducing the lender’s perceived risk. This can result in lower interest rates and better loan terms, making the overall borrowing experience more affordable. It’s an excellent option for borrowers struggling to secure a loan on their own.

Eligibility Requirements

For a co-signer to be effective, they usually need to meet specific eligibility requirements, including a higher credit score and stable income. Lenders may also require the co-signer to be a resident of the same state and demonstrate a willingness to assume responsibility for the loan if the primary borrower defaults.

Impact on Loan Terms

Having a co-signer can positively impact loan terms, including lower interest rates and more flexible repayment options. This can make a significant difference in the overall cost of the loan, allowing borrowers to secure more favorable financial conditions. Overall, a co-signer can be a valuable asset in the borrowing process.

What are the advantages of getting pre-approved for a car loan?

Obtaining pre-approval for a car loan offers several advantages that can enhance your overall car-buying experience. Understanding these benefits can help you make informed decisions.

Understanding Your Budget

Pre-approval provides a clear understanding of your budget, as it outlines how much a lender is willing to loan you. This clarity can streamline your vehicle search and help you focus on cars within your financial reach, preventing overspending.

Strengthening Negotiation Power

Having a pre-approved loan can strengthen your bargaining position when negotiating with car dealerships. It signals to sellers that you are a serious buyer with financing in place, potentially leading to better deals and less pressure during negotiations.

Speeding Up the Purchase Process

The pre-approval process can significantly speed up the overall car-buying experience. With financing already in place, you can move quickly to finalize your purchase, reducing the time spent at dealerships and making the process more efficient.

What should you do if you’re denied a car loan with a 620 credit score?

Being denied a car loan with a 620 credit score can be disheartening, but there are actionable steps you can take to improve your situation. Understanding these steps can help you navigate this setback effectively.

Understanding the Denial Reasons

When denied a car loan, it’s crucial to understand the reasons behind the denial. Lenders are required to provide a denial notice, detailing the factors that influenced their decision. Reviewing this information can help you identify areas for improvement in your financial profile.

Improving Your Credit Score

After a denial, consider focusing on improving your credit score. Implementing strategies such as paying off debts, making timely payments, and reducing credit utilization can enhance your creditworthiness over time. This proactive approach can increase your chances of loan approval in the future.

Exploring Alternative Options

If you are denied a car loan, exploring alternative financing options is essential. Consider seeking loans from credit unions or peer-to-peer platforms, which may have more flexible criteria. Additionally, improving your financial profile before reapplying can yield better outcomes.

How can you build credit after getting a car loan?

Building credit after securing a car loan is vital for future financial opportunities. Implementing strategic practices can strengthen your credit profile over time.

Making Timely Payments

Consistently making timely payments on your car loan is one of the most effective ways to build credit. Payment history accounts for a significant portion of your credit score, so establishing a habit of on-time payments can positively impact your overall creditworthiness.

Using Credit Responsibly

Responsible credit usage extends beyond your car loan. If you have credit cards, aim to keep balances low and make payments on time. This responsible behavior signals to lenders that you can manage credit effectively, leading to improved scores.

Monitoring Credit Reports

Regularly monitoring your credit reports allows you to track your progress and identify any discrepancies that could negatively impact your score. Utilizing free credit monitoring services can help you stay informed and proactively address any issues.

What are the long-term effects of taking a car loan with a 620 credit score?

The long-term effects of taking a car loan with a 620 credit score can significantly impact your financial health. Understanding these effects can guide you in making responsible borrowing choices.

Impact on Credit Score

Taking on a car loan can influence your credit score positively or negatively. Making consistent, on-time payments can improve your score over time, while missed payments can lead to declines. Awareness of this relationship is critical for maintaining a healthy credit profile.

Debt-to-Income Ratio Considerations

A car loan can affect your debt-to-income ratio, which lenders use to assess your financial health. A higher ratio may limit your ability to secure additional credit in the future. Understanding how to manage your debt responsibly can support better financial outcomes.

Future Borrowing Potential

How you handle your car loan can influence your future borrowing potential. Successfully managing the loan can lead to better credit opportunities, while struggles with repayment can create long-term challenges. Making informed borrowing decisions is essential for future financial success.

How do economic conditions affect car loans for those with a 620 credit score?

Economic conditions can significantly influence the availability and terms of car loans for borrowers with a 620 credit score. Awareness of these conditions can help borrowers navigate their financing options effectively.

Interest Rate Trends

Economic conditions, such as inflation and market demand for loans, can affect interest rates. During economic downturns, lenders may tighten credit availability, making it more challenging for subprime borrowers to secure favorable rates. Staying informed about interest rate trends can help borrowers time their applications more strategically.

Lender Policies

Economic conditions can also influence lender policies regarding credit score thresholds and loan terms. In uncertain markets, lenders may become more conservative, requiring higher credit scores for approval. Understanding these shifts can help borrowers adapt to changing lending landscapes.

Consumer Confidence

Consumer confidence plays a role in the overall economy and can impact lending conditions. When confidence is low, lenders may be less willing to extend credit, especially to those with lower credit scores. Staying informed about economic indicators can help borrowers better assess their financing options.

What resources are available for borrowers with a 620 credit score?

Borrowers with a 620 credit score can access various resources to improve their financial literacy and enhance their borrowing experience. Utilizing these resources can provide valuable support.

Financial Counseling Services

Financial counseling services offer guidance to individuals looking to improve their financial situations. These services can provide insights into budgeting, credit improvement strategies, and debt management. Seeking professional assistance can help borrowers navigate financial challenges more effectively.

Online Tools and Calculators

Several online tools and calculators can assist borrowers in understanding their financial options. From loan payment calculators to budgeting apps, these resources can help individuals make informed decisions about car financing and overall financial health.

Educational Resources

Numerous educational resources are available to help borrowers improve their financial literacy. Websites, workshops, and community programs often provide information on credit scores, loan types, and responsible borrowing practices. Taking advantage of these resources can empower borrowers to make better financial choices.

What are the signs of a predatory lender to watch out for?

Identifying predatory lenders is essential for protecting yourself as a borrower. Recognizing the warning signs can help you avoid unfavorable loan conditions.

Excessive Fees

Predatory lenders often impose excessive fees, including high origination fees, processing charges, and prepayment penalties. These fees can significantly increase the overall cost of the loan, making it essential to scrutinize all associated charges before agreeing to a loan.

Unclear Terms

Predatory lenders may present loan terms in a confusing or misleading manner. It is crucial to thoroughly read and understand all loan documents, asking questions if any terms are unclear. If a lender is unwilling to clarify terms, it may be a red flag indicating predatory practices.

Pressure Tactics

Be wary of lenders that use high-pressure tactics to push you into signing a loan agreement quickly. Legitimate lenders will provide time for you to review terms and ask questions. If you feel rushed or pressured, it’s advisable to seek alternative financing options.

Mini FAQ

Is a 620 credit score good enough for a car loan?
A 620 credit score is considered subprime but can qualify for a car loan, though terms may be less favorable.

What interest rates can I expect with a 620 credit score?
Interest rates for a 620 credit score typically range from 10% to 15%.

Can I negotiate terms with a lender?
Yes, negotiating terms such as interest rates and fees is possible, even with a 620 credit score.

How can I improve my credit score before applying?
Paying off debts, making timely payments, and reducing credit utilization can help improve your score.

What types of loans are available for a 620 credit score?
Options include traditional auto loans, subprime auto loans, and Buy Here Pay Here dealerships.

What should I do if I’m denied a loan?
Understand the reasons for denial, improve your credit score, and explore alternative financing options.

How can a co-signer help my loan application?
A co-signer with better credit can improve your chances of approval and secure lower interest rates.