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In NL, what should I know about credit score impact of auto loans for car loans?
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In NL, what should I know about credit score impact of auto loans for car loans?

In Newfoundland and Labrador, much like the rest of Canada, applying for an auto loan will typically result in a 'hard inquiry' on your credit report. This, along with the immediate addition of a new credit account, can cause a slight, temporary dip in your credit score. However, the long-term impact on your credit health is overwhelmingly positive, provided you manage the loan responsibly. Consistent, on-time payments are the most crucial factor, demonstrating your reliability to Canadian credit bureaus like Equifax and TransUnion and significantly boosting your payment history component. Successfully managing an installment loan also diversifies your credit mix, further strengthening your overall credit profile over time. This matters immensely in the current 2025 market, as a strong credit score directly influences the interest rates you qualify for, potentially saving you thousands of dollars over the loan's term. Furthermore, a well-managed auto loan enhances your access to other credit opportunities in the future.

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