In today’s video, I am going to show you how much you’re likely to pay for a car loan over 5 years if you have good, bad, or average credit.    

Credit is one of those things that most of us mess up before we even realize what’s happening.

Credit is a numerical way to determine how much of a risk you are when lenders are deciding if they will lend you money and at what interest rate you will have to pay to receive that loan.

Your credit score is a way to let others know if you can be trusted with borrowed money and how risky it will be for them to lend you money. Based on how risky they feel it will be from reviewing your score determines what rate you will pay for the ability to borrow money. You will pay a higher rate if you have a lower score and a lower rate with a high score.

So what do the numbers look like?

If you have proven over time that you make payments on time and don’t borrow all the way to the max limit you’re allowed to borrow at then you will be able to borrow money at low rates.

If you haven’t proven this yet, either because you haven’t taken out a loan, opened a credit card, or if you haven’t made payments on these for several years

It is really important to have good credit because you will get a low rate and that money will add up to a surprising amount overtime.

If you have bad credit, I have been there too and the important thing to remember is you can’t fix it overnight, but you can fix it. You need to take a look at your report and address the negative factors. Payback debts, etc. over time you will recover.