 TITLE: Buying a Car: How Much Can You Afford? CONTENT: How Your Credit Score Affects Your Car Loan Affordability\n---------------------------------------------------------\nTo give you a better idea of how much you could save by building credit before you buy, here are some examples of average loan rates, term lengths and loan amounts on a new car for different credit score ranges based on Experian data as of the fourth quarter of 2018.\nScore Range\nAverage Loan Rate\nAverage Term Length  \n(in months)\nAverage Loan Amount\nTotal Interest Paid\n300-500\n14.9%\n72\n$26,400\n$13,700\n501-600\n12.2%\n73\n$29,400\n$12,400\n601-660\n7.9%\n73\n$33,100\n$8,700\n661-780\n5.0%\n70\n$33,500\n$5,200\n781-850\n4.2%\n63\n$31,700\n$3,700\nAs the table shows, you could potentially save thousands of dollars by increasing your credit score from one range to the next. Even improving your score from the mid-600s to 700-plus could garner you an interest rate 3 percentage points lower on a car loan—which could help you save over $3,000 in total interest.\nOf course, building credit can take time, especially if you have some negative items on your credit reports that are dragging down your scores. Here are a few steps you can take to get on the right track:\n*   **Check your credit reports**: Your credit scores are based on information found in your credit reports. By checking your credit report with Experian and the other credit bureaus, you can pinpoint the areas that need to be addressed. Also, check for potentially erroneous or fraudulent information that could be hurting your credit. If you find something you believe shouldn't be there, you can file a dispute with the credit reporting agencies.\n*   **Get caught up on payments**: If you have any credit accounts that you're behind on, get current on payments as quickly as possible and make on-time payments going forward.\n*   **Pay down your credit card balances**: If you have high credit card balances, paying them off can reduce your credit utilization rate and help improve your credit score.\nDepending on the factors that are influencing your credit scores, taking these steps can help improve your credit scores and help you establish a positive credit history over time. END