Does a car loan help with credit score?

[Anonymous]

I have no debt at all.  I'm trying to improve my credit score.  I'm wondering if a car loan would help in the 4-6 month time frame to bring my score up?

[lajntx]

In my experience.... little to none at all. Last year I had no open TL's other than a student loan and tons of baddies.

1. Traditional lenders wouldnt finance anything -- even with 3K down... including a 6K used car which would have been a 50% DP.

2. I went to a subprime lender- CNAC ( JDByrider ).... all 3 scores jumped 10-15 points... and even with a year of on time payments I never saw another jump until I added a major card and saw about a 15-20 point jump on EQ & TU.

Other people I have seen with auto loans dont seem to be getting any scoring help.. or anything like what happens with credit cards. I think thats the main reason why Auto lenders use an Auto Enhanced Fico because a regular fico score tends to be more biased towards credit cards and not auto loans.

Now if you have a clean history... you might have better results.

[Anonymous]

For the timeframe of 4-6 months, I believe an auto loan will hurt your score.  When I first received my loan my score had dropped 30 points (keep in mind my first auto loan).  It took about a year to break even and start gaining ground.  What helps is that if you have a solid car loan history, it looks good when you purchase another car.

[creditwherecreditisdue]

It can help, but it will most likely hurt in the < 6 month time period. Things will start to improve at 6 months and more at one year. It can be hard to get started and a secured loan like an auto loan is a good way to do it.