Used Car Financing in New Brunswick for a 600-700 Credit Score
Navigating the used car market in New Brunswick with a credit score between 600 and 700 can feel uncertain. You're in a unique position-not quite prime, but far from high-risk. This calculator is specifically designed for your scenario, factoring in New Brunswick's 15% HST, a 60-month loan term, and the interest rates you're likely to encounter.
A score in this range means lenders see you as a rebuilding or developing borrower. They'll look closely at your income stability and debt-to-income ratio, but approval is very achievable. This tool will help you set a realistic budget before you even visit a dealership.
How This Calculator Works for New Brunswick Buyers
Our calculator demystifies the auto loan process by breaking it down into the key factors lenders in New Brunswick use:
- Vehicle Price: The sticker price of the used car you're considering.
- Down Payment/Trade-in: The amount of cash or trade-in equity you're applying. This reduces the amount you need to finance and lowers your monthly payment.
- New Brunswick HST (15%): This is a critical factor. The 15% Harmonized Sales Tax is applied to the vehicle's price (after the trade-in value is deducted) and is added to your total loan amount. Our calculator does this automatically.
- Interest Rate (APR): For a 600-700 credit score on a used vehicle, rates in New Brunswick typically range from 9.99% to 19.99% O.A.C. The final rate depends on your full credit profile, income, and the vehicle's age and mileage. We use a representative rate for our estimates.
- Loan Term: This is fixed at 60 months (5 years), a common term for financing used vehicles that balances affordability with paying the loan off in a reasonable time.
Example Scenarios: 60-Month Used Car Loan in NB
Let's see how the numbers play out with New Brunswick's 15% HST. These estimates use a sample interest rate of 12.99% O.A.C., which is common for this credit tier.
| Vehicle Price | Down Payment | Total Amount Financed (incl. 15% HST) | Estimated Monthly Payment |
|---|---|---|---|
| $15,000 | $1,500 | $15,525 | $353/mo |
| $20,000 | $2,000 | $20,700 | $471/mo |
| $25,000 | $2,500 | $25,875 | $588/mo |
*Disclaimer: These are estimates for illustrative purposes only. Your actual payment will vary based on the final approved interest rate and terms. O.A.C. = On Approved Credit.
Your Approval Odds with a 600-700 Credit Score
Your approval odds are good. Lenders are often willing to work with borrowers in this credit range, provided other factors are strong. They will focus on:
- Income Stability: Lenders want to see a consistent and verifiable source of income of at least $2,200 per month. If your income is non-traditional, it's still possible to get approved. For more on this, check out our guide on how Self-Employed? Your Bank Doesn't Need a Resume.
- Debt-to-Income Ratio (DTI): This is crucial. Lenders want to ensure your total monthly debt payments (including the new car loan) don't exceed 40-45% of your gross monthly income. Use this calculator to see how a car payment fits into your budget.
- Credit History Nuances: A score of 650 from steady, long-term credit use is viewed more favourably than a 650 recovering from recent missed payments or a Consumer Proposal? Good. Your Car Loan Just Got Easier.
While this calculator is excellent for dealership purchases, the financing process differs if you find a vehicle through a private seller. To understand those options, read our article: Bad Credit? Private Sale? We're Already Writing the Cheque.
Frequently Asked Questions
What interest rate can I expect in New Brunswick with a 650 credit score?
With a 650 credit score, you're in the fair-to-good range. For a used car on a 60-month term, you can generally expect interest rates (APR) between 9.99% and 19.99%. The exact rate will depend on your income stability, down payment, the age of the vehicle, and the specific lender's criteria.
How is the 15% HST calculated on a used car loan in New Brunswick?
The 15% HST is calculated on the final sale price of the vehicle. If you have a trade-in, the value of your trade-in is deducted from the vehicle price *before* tax is calculated. For example, on a $20,000 car with a $5,000 trade-in, HST is charged on the remaining $15,000 ($2,250 tax). This total amount ($17,250) is then financed.
Is a 60-month (5-year) loan term a good idea for a used car?
A 60-month term is often a good balance for used cars. It keeps the monthly payments more manageable than shorter terms. However, it's important to consider the vehicle's age and potential lifespan. You want to avoid a situation where you are still making payments on a car that requires significant repairs. For a newer, reliable used car, 60 months is a very standard and sensible term.
Can I get approved for a car loan in NB with a score of 620 if I'm self-employed?
Yes, absolutely. Lenders are more interested in the stability and provability of your income than its source. As a self-employed individual, you'll need to provide documents like bank statements for the last 3-6 months and/or your Notice of Assessment from the CRA to prove your income. A consistent history of deposits is key.
How much of a down payment should I have for a used car with fair credit?
While not always mandatory, a down payment is highly recommended, especially with a credit score in the 600s. It shows lenders you have 'skin in the game.' Aiming for 10-20% of the vehicle's price is a great target. It reduces the loan amount, lowers your monthly payments, and can help you secure a better interest rate.
