Consider this example. Let’s say that you want to buy a new car for $35,000 and that you want to use a 60-month loan to finance it. As of August 2023, a borrower with a FICO® Score of 750, which is in the realm of “very good” credit, could expect an interest rate of 7.44%, which would yield a monthly payment of $700.
On the other hand, a borrower with a “fair” FICO® Score of 650 could expect an interest rate of about 12.39% based on the national average, which would produce a monthly payment of $747.