Your Secret Credit Score… What You Don’t Know Can Hurt You

Knowledge is Power.

We like to say this over and over in regard to getting approved for a car loan. Go to a lender or the finance department of a dealership without knowledge of the right things and you’re asking to be taken advantage of. At a minimum, you should have some idea what auto loan rates are available to someone with your credit score.

But what if there were a secret credit score that lenders use to determine your credit worthiness, and you had no way of finding out this score for yourself? Unfortunately, this isn’t just a fantasy…

Top Secret Credit Score

Your FICO Score

Regular readers of this blog (and most adults in general) know about the FICO score. This is a number calculated from your credit account payment history and other factors like the age of those credit accounts, amount of credit available on open credit lines, and debt-to-income ratio. The purpose of the FICO score is to simplify the assessment of your risk as a borrower.

Some companies offer free credit scores that approximate the FICO score.

Lenders who make car loans often use a different score, though, known as the Auto Enhanced Credit Score. It differs from the standard credit score in a couple of key ways.

Auto Enhanced Credit Score

First, it is calculated differently from the FICO score, in that it is used to specifically assess your risk as it pertains to car loans, rather than credit risk in general. While your FICO score is heavily reliant on your revolving credit lines (credit cards, for example), your Auto Enhanced Credit Score is much more reliant on your auto payment history. This can be good or bad.

If you have damaged credit for one reason or another but you have always made your car loan (or lease) payments on time, your other credit issues will hurt you less. Yay!

If, however, you otherwise have good credit but have been late here and there on car payments, you’re likely to get dinged on your interest rate, and end up paying more. Not awesome.

Another key difference is that there is no way for you to know your Auto Enhanced Credit Score. It’s not available to the general public, which definitely gives the advantage to the lender (knowledge is power, remember?).


But at least now you know about it. While this might not help you today, it’s something to keep in mind for the future. Since automobiles are some of the biggest purchases most of us make, anything that increases the interest rate of our loan can wind up costing us a lot of money. Be super diligent about making car loan payments on time and it will pay off in the long run.