Question: Review the simple interest rate based on FICO scores to answer the question:
FICO Score
Simple Interest Rate
800–850
4.295%
740–799
5.597%
670–739
8.132%
580–669
9.358%
300–579
12.413%
A consumer, with a credit score of 645, is planning to buy a used car and needs to borrow $3500 with a simple interest rate loan.
Determine the interest rate the consumer will qualify for if they raise their credit score 60 points.
4.295%
5.597%
8.132%
9.358%
1. **State the problem:**
A consumer has a credit score of $645$ and wants to know the new simple interest rate if their credit score increases by $60$ points.
2. **Calculate the new credit score:**
$$645 + 60 = 705$$
3. **Determine the interest rate based on the new score:**
From the table:
- $670$ to $739$ corresponds to an interest rate of $8.132\%$
- $580$ to $669$ corresponds to $9.358\%$
Since $705$ falls between $670$ and $739$, the new interest rate is $8.132\%$.
4. **Summary:**
The consumer's interest rate decreases from $9.358\%$ (for score $645$) to $8.132\%$ after raising their credit score by $60$ points.
**Final answer:** $8.132\%$