What Does “OAC” (On Approved Credit) Mean When Financing a Car?

When obtaining a car loan, there are often varying degrees of loan rates offered. Typically the best rate is only available “OAC,” or “on approved credit.” OAC is a standard that relates directly to one’s credit score. The better one’s credit score is, the more likely one will be to secure an OAC rate.

When one goes to purchase or lease a car, the dealership will run a credit check on the customer. Whether the applicant qualifies for an OAC rate is then determined by the credit score. Typically, a good credit score will result in a lower rate while a bad credit score will result in a higher rate, but typically the lender or dealer will not disclose the actual score necessary to secure an OAC rate.

People establish credit when they get credit cards. Someone who pays their cards off and doesn’t have a negative credit history will probably have decent credit. Someone who has a lot of cards with high balances and some blemishes on their credit report will generally have a poor credit score, but that does not mean someone with bad credit cannot get a loan.

Maintaining a good credit score which translates into a good OAC rate is essential for individuals who are looking to buy or lease a car.