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Apr 27

What credit score do you need to get 0% financing on a car?

Reading Time: 3 mins

Understanding how to get 0% APR financing on an auto loan isn’t a complete mystery, but lenders tend to be vague about it. However, in general, you need a credit score of 700 or higher to get approved. That being said, your credit score is just part of the equation when it comes to getting a zero-interest auto loan. You also need to find the manufacturers who are offering 0% APR loans, and you need to understand when in the car buying process to ask for this type of loan.


How Does Zero-Interest Financing on a Car Loan Work?

A zero percent APR auto loan has no interest rate. This means you can finance the purchase of a new vehicle, and 100% of your monthly payment will go toward the loan’s principal balance. There will be no interest charges whatsoever.


How to Find Manufacturers Offering 0% APR Car Loans?

Banks and credit unions don’t usually offer zero-interest vehicle loans. These types of loans are generally only provided by auto manufacturers. Therefore, you should start by researching auto manufacturers offering 0% APR car loans. To do this, you can go straight to the manufacturer’s website and apply for a car loan online.

In most cases, manufacturers will only offer no-interest loans on specific models and only under certain circumstances.


When to Mention You Want 0% Financing

Just because you can get 0% APR financing on your auto loan doesn’t mean you can’t still try to get the best possible deal on the car you want. The best way to do this is to wait to tell the dealer that you wish to 0% APR until after you’ve negotiated the car’s price. If you let the dealer know that you want zero-interest financing before negotiating the price, you may not get the best deal.

However, you still need a great credit score to get this kind of financing, but what if you don’t meet this minimum requirement? If this is the case, you’ll need to get your credit into shape.


How to Get Your Credit into Shape?

The information in your credit report is the basis for your credit score. Therefore, you must make sure that everything in the report is accurate. You should check your credit report using the three major consumer credit bureaus because you don’t know which bureau or bureaus the lender will use. These bureaus are Equifax, Experian, and Transunion. If something on one of your reports doesn’t look right, you should dispute the error before applying for a car loan.

Once you’ve checked that everything on your credit reports is correct, you need to look at your credit score. Your credit score consists of a three-digit number that lenders use to determine your creditworthiness. If your score is below 700, there are some things you can do to improve your score over time. However, it’s important to know that improving your credit takes time, so you likely won’t qualify for 0% APR financing immediately. Nonetheless, the sooner you start to work on your credit, the better.

To improve your credit, you should:

  • Be sure to pay the minimum balance on all your bills on time.
  • Work to pay down the balances on your credit cards.
  • Don’t close your old credit cards.
  • Only apply for new credit when you absolutely need it.


Things to Consider When Looking into 0% Financing

While zero-interest financing seems like a dream come true, there are some drawbacks:

    • Dealers may attempt to make up the cost somewhere else. In some cases, your dealer may increase the car’s price or add costly fees to the contract to compensate for the interest savings. Additionally, they may pressure you to purchase add-on products, such as gap insurance or a maintenance package.
    • Your monthly payment may still be high. Even without interest charges, your monthly payment may still be relatively high. Therefore, you should always run the numbers to make sure you can afford the loan payments.
  • They usually have long repayment terms. Dealers may try to get you to apply for a loan with a long repayment term like 72 or 84 months. However, locking yourself into a prolonged financial commitment can make it challenging for you to make meaningful progress on your other money goals. Therefore, if you can, you should opt for a shorter repayment term.



If you can’t get a 0% APR vehicle loan on your first try, you still have options. There are plenty of lenders, including banks, auto finance companies, and credit unions that offer low-interest rate car loans that won’t result in significant interest payments. Therefore, you should shop around and compare rates to find the best overall deal for your situation.


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