What Is a FICO Auto Score?

Lenders use FICO auto scores to determine consumers’ creditworthiness for car loans

Fact checked by Betsy Petrick

What Is a FICO Auto Score?

A FICO auto score is a credit scoring model that many lenders use to judge borrowers’ creditworthiness when they apply for auto loans. It is one of several credit scores created by FICO, the leading company in that field. Your FICO auto score is a three-digit number, ranging from 250 to 900, and the higher your score, the more likely you are to qualify for a loan with a good interest rate and other terms.

Key Takeaways

• A FICO auto score is an industry-specific credit scoring model that lenders can use when evaluating auto loan applications.
• Like other FICO scoring models, FICO auto scores are calculated based on factors such as credit history and payment behavior.
• FICO auto scores may be different from base FICO scores.
• Consumers can access their FICO auto scores via a paid FICO subscription or from a major credit bureau.

Understanding FICO Auto Scores

FICO credit scores are calculated using five weighted categories. For most scores those weightings are:

• Payment history (35%)
• Amounts owed (30%)
• Length of credit history (15%)
• Credit mix (10%)
• New credit (10%)

The information for each category comes from your credit reports, compiled by the three major credit bureaus.

FICO’s scoring models can produce both “base” scores for general purposes and industry-specific ones for particular types of borrowing, such as credit cards, mortgages, and car loans. FICO auto scores use the same data as base FICO scores but weight it differently. For that reason, your base FICO score may be different from your FICO auto score.

There are several versions of FICO scores used in auto lending, depending on which credit bureau supplied the data. They include FICO Auto Score 2, 4, 5, 8, 9, and 10.

Range of FICO Auto Scores

As mentioned, FICO auto scores range from 250 to 900, and the higher the score, the more attractive it will be to potential lenders.

FICO auto scores are grouped similarly to base FICO scores in terms of credit quality. The credit bureau Experian breaks base scores down this way:

• 300 to 579: Poor
• 580 to 669: Fair
• 670 to 739: Good
• 740 to 799: Very good
• 800 to 850: Exceptional

Lenders may also classify scores in these terms:

• 500 or less: Deep subprime
• 501 to 600: Subprime
• 601 to 660: Nonprime
• 661 to 780: Prime
• 781 to 850: Super prime

FICO Auto Scores vs. Base FICO Scores

FICO auto scores and base FICO scores use the same information from individuals’ credit reports but, as mentioned, the auto score model applies different weightings. For example, your history of auto loan payments will matter more in the calculation of your FICO auto score.

That means the same borrower could have a different base FICO score and FICO auto score depending on whether they have ever had an auto loan and how consistent they were in making payments on it.

Base FICO scores also use a slightly different scale, ranging from 300 to 850, rather than the 250 to 900 scale for FICO auto scores.

Importance of FICO Auto Scores in Auto Loan Approval

When you need to a loan to buy a car, your FICO auto score will be an important factor that many lenders consider. But their specific requirements may vary.

Lender Requirements for FICO Auto Scores

There is no standard minimum credit score in the auto finance industry, although borrowers whose credit scores are considered good or better stand a better chance of approval.

While many lenders use FICO auto scores, others may use different credit scoring models, such as VantageScore, FICO’s major competitor. If you’re curious, you can ask prospective lenders which credit scores they use before you agree to a credit check.

Factors Influencing FICO Auto Score Requirements

Most auto lenders will consider other financial factors, such as your income and how large a down payment you are prepared to make, in addition to your FICO score.

Lenders may also change their requirements from time to time based on market factors, like car prices and demand for loans.

Good FICO Auto Scores for Auto Loan Qualification

Lenders typically prefer borrowers with a credit score of 661 or higher. In addition to qualifying you for a loan, your FICO auto score can influence the interest rates that lenders offer you. A higher credit score will usually translate into a lower interest rate.

For example, an analysis by Experian found that for new cars, average auto loan interest rates in early 2023 broke down as follows. (Note that these figures are based on the VantageScore model, which differs from FICO in some of its criteria and weightings but is also calculated on a 300 to 850 scale.)

• 579 and lower: 14.08%
• 580 to 619: 11.53%
• 620 to 659: 8.86%
• 660 to 719: 6.40%
• 720 and above: 5.18%

How to Check Your FICO Auto Score

Checking your FICO auto score before you apply for an auto loan can help you anticipate the likelihood of being approved and the interest rate you can probably expect.

Paid Options for Accessing FICO Auto Scores

You can get your FICO auto score directly from FICO with a plan that charges a monthly fee.

You can also pay one of the three major credit bureaus (Equifax, Experian, and TransUnion) for your auto score. While the credit bureaus are required to offer consumers free credit reports periodically (see below), they can charge for credit scores.

Free Options for Accessing FICO Auto Scores

You cannot access your for FICO auto score for free, but you can obtain your base FICO score. While it may not be exactly the same as your FICO auto score, it can give you an idea of what auto lenders will see.

Many banks, credit unions, and credit card companies offer free FICO or VantageScore credit scores, as do a number of websites. Credit counselors may also be able to provide you with a free credit score.

How to Improve Your FICO Auto Score

If your FICO auto score is in need of improvement, there are a number of things you can do.

• Pay all your credit bills on time. This is the single most important factor in any FICO score.
• Pay off any auto loans in collections. Because your FICO auto score puts particular weight on your auto loan payment history, if you have an auto loan in collections, aim to pay it off as soon as possible.
• Reduce your credit usage. Your credit utilization ratio is another major factor in your credit score. Being at or close to your credit limit will have a negative impact, while paying down your credit card balances can raise your score.
• Dispute credit report errors. An error on your credit report (such as a missed payment that you know you made) can damage your credit score. If you find an error, you can dispute it with the credit bureau, which is then required to investigate. Because your credit reports can vary slightly from one credit bureau to another, it is worth checking all three before you apply for a loan. By law, you are entitled to a free copy of your credit report at least once a year from each of the three major bureaus. The official website for that purpose is AnnualCreditReport.com.

What Is a Good FICO Auto Score?

FICO auto scores range from 250 to 900. In general, FICO scores that fall between 670 and 739 are considered good. Even higher scores are considered very good or exceptional.

Do You Need a FICO Auto Score to Buy a Car?

If you need an auto loan to buy a car, lenders are going to run a credit check on you. Some lenders will use the industry-specific FICO auto score. You will likely need a credit score of 661 or higher to qualify for an auto loan with a good interest rate.

How Often Does the FICO Auto Score Update?

Credit scores usually update at least once a month, based on any changes in your credit reports.

What Is the Difference Between FICO 5 and 8 Scores?

FICO Score 5 and FICO Score 8 are both common credit scores. Mortgage and auto lenders often use FICO Score 5, while credit card issuers typically use FICO Score 8.

Can I Check My FICO Auto Score for Free?

While you can obtain some of your credit scores for free, you will likely have to pay to see your FICO auto score. You can buy it from FICO or from one of the credit bureaus.

The Bottom Line

Your FICO auto score can be important when you apply for an auto loan. While it may differ somewhat from your base FICO score, maintaining the same smart credit habits will help keep it in good shape.

Read the original article on Investopedia.