Which Credit Card Bureau Is Most Used For Auto Loans?

When getting a car loan, many people want to know which credit bureau is most used by lenders for this type of purchase. To start, the three main credit bureaus are Equifax, Experian, and TransUnion–each of these agencies keeps track of your credit history and score.

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Auto lenders will almost always use at least one of the three major credit bureaus when looking at your credit report. Each credit bureau will have slightly different information on your credit report. This information may be helpful if you want to know how to build credit after car repossession.

If the potential lender uses all three services, it will most likely use the middle score from the three credit reports. So, if your Experian score is 690, your TransUnion score is 710, and your Equifax score is 720, the lender will use the 710 score.

Ask the lender which credit bureau they plan to use so you can check your report for accuracy. 

How To Fix a Problem With an Old Car Loan

Car repossession can have a very negative effect on your credit score. If you have had a car repossessed, you may be wondering how you can ever get your credit score back up. Here are a few tips on how to build credit after car repossession.

Monitor Your Credit Reports

The first thing you need to do is get a copy of your credit report. You are entitled to one free credit report from each of the three major credit bureaus every year. Check your report for any mistakes and dispute any inaccuracies.

Make Payments on Time

You need to start paying all of your bills on time, every time. Payment history is one of the largest contributing factors to your credit score. So, ensure you pay on time for every amount that you borrow.

Reduce Your Debt

Another important factor in your credit score is your credit utilization ratio. This is the amount of debt you have compared to your credit limit. If you have a lot of debt, you may need a debt consolidation loan to pay them off–this can help you reduce your interest payments and get your debt under control.

Pay Off Collection Accounts

If you have any accounts with a collection agency, you should try to settle them because they may negatively affect your credit score. If you can’t pay them off, you may be able to negotiate a reduced or extended payment schedule and ultimately have the account removed from your credit report.

Build Up Your Credit Limit

You could ask your credit card company for a higher limit if it is currently low. This can help you bring your credit utilization ratio down and your credit score up.

Get a Secured Credit Card

If you have bad credit, you may not be able to get a traditional credit card, but you may get a secured credit card. A secured credit card can help you build up your credit history and improve your credit score. Ensure you use the card responsibly and make your payments on time.

Other Credit Items That Might Affect an Auto Loan Application

In addition to an auto repossession, you may be wondering if there are other items in your credit history that might impact your ability to get a loan to purchase a car. For example, does closing a checking account affect credit score? Your checking account is not a line of credit, so closing it should not directly impact your credit score; however, if you have a history of bouncing checks or making late payments, closing your account could indirectly impact your score.

Bouncing checks or making late payments can also negatively mark your ChexSystems report. This report tracks your banking history and is used by banks to decide whether to approve you for an account. If you have a negative mark on your ChexSystems report, this could make it difficult to open a new checking account.

Maybe you are wondering if a debit card builds credit–debit cards can build your credit if they report your activity to the credit bureaus. If you use your debit card regularly and make on-time payments, your positive activity can help you build up your credit history and improve your credit score.

Not all debit cards report to the credit bureaus, so you need to check with your card issuer to see if your card activity will be reported.

Final Thoughts

Auto loans are an important part of building credit. If you had a car repossessed, it can be a major setback for your future financial security. You can build your credit back up by monitoring your credit reports, paying your bills on time, reducing your debt, and using a secured credit card.

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