By Adam Jusko, ProudMoney.com, adam@proudmoney.com

A 650 credit score puts you in the “fair credit” or “average credit” or “non-prime/near-prime” zone, meaning you’re definitely not going to get the best interest rates on an auto loan. But you won’t get the worst interest rates, either.

Interest rates on car loans vary with the condition of the overall economy, so the answer to what interest rate you’ll get with your 650 credit score is not fixed in time. The rate you’d be able to get today could be very different a year from now (or from this time last year).

  • The rate you can expect on an auto loan with a 650 score in late 2020/early 2021 is around 6.51% for new cars and 10.13% for used cars.*

Reduce Your Rate with a Shorter Term or Bigger Down Payment

These rates are based on auto loans that generally run between 5 and 6 years (or maybe more commonly thought of as 60-month or 72-month auto loans). If your loan term is less than 5 years, you may be able to find rates better than those mentioned above.

You can also usually reduce your interest rate if your down payment is significant in relation to the price of the car, because your down payment shows a commitment to repayment due to the fact that you’ve tied up some of your own money in the initial purchase. Those $0-down auto loans sound good, but you’ll often pay higher interest, especially with that 650 credit score that is only so-so.

Rates Are Trending Lower

Looking back to the previous quarter, auto loan interest rates in Quarter 2 of 2020 for a “near prime” credit score of 650 were 7.14% for new cars and 11.41% for used cars, so there has been a significant dip in rates since mid-2020.

* Source: Experian State of the Automotive Finance Market Q3 2020