If you have a 580 credit score you may be wondering if it’s possible to get a loan. Learn whether you can get a loan with a credit score of 580 and how to do it.
- Can you get a loan with fair or poor credit?
- How lenders use credit scores to gauge risk
- Why Legacy Auto Credit is different
- Getting a car loan with bad credit
Can you get a loan with fair or poor credit?
The short answer is, yes, you can get loans when you have a fair or poor credit score. It’s helpful to understand how credit scores range in Canada work.
According to Equifax, a company that issues credit reports in Canada, a credit score of 580 would put you in the “fair” credit category. Anything below that would be poor or bad credit.
The types of loans you may qualify for with a 580 credit score include:
- Mortgage loans
- Car loans
- Personal loans
- Credit cards
How lenders use credit scores to gauge risk
Your credit score is a three-digit number. It’s based on the information in your credit report.
The most important factors that impact credit scores are:
- Payment history (35%)
- Credit utilization (30%)
- Length of credit history (15%)
- Credit mix (10%)
- New credit applications (10%)
Together, the information in your credit report and your credit scores tell lenders how responsible you are when it comes to using credit. That’s one of the things — along with your employment history and income — that helps a lender decide whether to loan you money or not.
Fair or poor credit scores are generally viewed as being higher risk by lenders. A low credit score can hint at bad credit habits, such as paying late or not repaying loans at all.
While lenders won’t count you out for a loan if you have a 580 credit score, you might find getting approved a little more difficult. And you may pay a higher interest rate to borrow compared to someone who has a better credit rating.
How Legacy Auto Credit is different
Some lenders may be more stringent than others in approving loans for borrowers with a 580 credit score. Legacy Auto Credit offers competitive rates for borrowers from all credit backgrounds, including those with bad credit or no credit.
Past credit mistakes or a lack of credit history won’t count against you. Legacy is experiencing in helping borrowers who have fair or poor credit due to:
- Slow, late or missed payments
- Past bankruptcy filings
- Repossession
- Consumer proposals
- Divorce
- Low income
- Orderly Payment of Debt
We can also assist borrowers who are new to Canada and haven’t established credit yet, as well as car buyers who may have poor credit due to circumstances beyond their control.
Getting a car loan with bad credit
If you’re planning to buy a new or used car, use these tools and resources to get your credit in shape:
BUILD YOUR CREDIT SCORE
- Check your credit score to see where you stand and what needs improvement.
- Report any errors you find on your credit report, which could add points to your score.
- Learn which debt you should pay off first to help raise your score.
- Take steps to repair your credit after making a late payment.
- Use caution when paying credit repair companies for help.
FINANCE A CAR PURCHASE WITH BAD CREDIT
- Find out whether you need to open a bank account before applying for a loan.
- Learn what the minimum income is for a car loan.
- Compare lenders to check the average interest rate for a car loan with bad credit.
- Consider offering a bigger down payment to get approved for a bad credit car loan.
Let Legacy Auto Credit help with your next car purchase
If you have a 580 credit score or a score below that mark, working with the right lender can make buying easier. Legacy Auto Credit will work with you to find the right financing solution, based on your credit history and needs.