We asked Harrine Freeman to explain further: “Obtaining a car loan can either lower, increase or have no impact on your credit score.
Applying for a car loan lowers your credit utilization, which increases your credit score prior to making your first payments.
Does buying on finance affect credit score?
Buy Now Pay Later Types: Retailer Financing vs. Point of Sale Installment Loans. If you use a service that does report the credit bureaus, your payments will affect your credit score. Generally speaking, on-time payments will help your credit score while late payments may cause your credit score to drop.
Will buying a car affect my credit score?
Any time you buy something on credit; it has the potential to impact your credit score. Buying a car is no exception. However, credit purchases can also positively affect your credit score. New Vehicle Purchases If you plan on financing or leasing, you’ll have to apply for credit.
Photo in the article by “Wikipedia”