If you dream about purchasing a car that costs $100,000 or more a factor other than money might come into play — your credit score.
Applying for a luxury auto loan often requires a credit score of at least 700. Many lenders prefer a “very good” credit score of 740-799 or an “excellent” score of 800-850, according to Auto Debt Capital. This limits the number of people who qualify for such a large loan.
But don’t be discouraged. While some lenders may accept a lower score, there are other credit-related criteria they can consider.
For instance, an established vehicle credit history. According to LendingTree, lenders like to see that you’ve previously borrowed similar amounts for a similar purpose. For instance, if you want to borrow $100,000 you’ll need to have secured a loan for at least three-quarters of that amount for another car.
In addition, before you head to the dealership you can prepare by reducing your credit liability. This will also help lower your monthly payment and interest rate.
As The Motley Fool explained, improving your credit score will help you qualify for the most affordable rate. You’ll also want to make as big a downpayment as you can afford to reduce your payments and lower your loan amount. And finally, don’t forget to shop around for your loan to get the best financing.