Credit score question?

[mlee]

Originally Posted by Iwantone2

yea, i don't know either, but maybe i forgot to mention that my name is on the mortgage don't know if that matters...my credit score went up A LOT becuase i was $14K in c.c. debt (school ) 10 months before i bought my car. when i paid that all off (1.5 months before my car came in), i checked my own score and i saw 792.

in hindsight, i don't care about the high interest because i am paying way over my required payment, so i'm paying my car off quicker.

You've got that all backwards... High Credit Score = Good
A score higher than 750 should get you about anything you want.

[jfclavel]

Originally Posted by jrc1122

a score below 600- and you make 30K a year, and you are trying to finance 40K.. Good luck..

How much down will you have?-- If you put 20% down, maybe.. GMAC might be your best bet, they are hurting, and seem pretty flexible to who they loan to. Expect a rate of 10%+ Maybe upwards of 15%- which would make it such a rip off it wouldn't be worth it.


Not to rain on your parade, but a score below 600 is bad, and it didn't get that way with just lack of credit, it got that way with late payments, or accounts in default. This scares banks away from wanting to loan to you. To them it is pretty much a forecast of what is to come. Sure the weather man can be wrong, but we all still plan our wadrobe based off what the weather guy says.

Bottom line-- It is going to be tough. Co-signer might be your best bet.

Good luck!

no, you're right. thing is i didn't get there by choice or because i just didn't care. im 21 bout to be 22, go to school and stuff, still live at home. my parents hit a slight financial bump and it was a choice between helpin them save the house or paying off my cards. i have low debt to income ratio of course. only thing i owe is a couple of balances on a couple of cards.... no co-signer cuz mom and dad have less than ideal credit for the same reason.

now were back on our feet, and i can actually can afford the car, even at a high rate. ideally what i wanna do is put everything towards the car. since im still in school i really cant move out just yet cuz its cheaper to stay home. so while im finishing school im paying off my car....

think it'll happen??? =/

[jrc1122]

Originally Posted by jfclavel

no, you're right. thing is i didn't get there by choice or because i just didn't care. im 21 bout to be 22, go to school and stuff, still live at home. my parents hit a slight financial bump and it was a choice between helpin them save the house or paying off my cards. i have low debt to income ratio of course. only thing i owe is a couple of balances on a couple of cards.... no co-signer cuz mom and dad have less than ideal credit for the same reason.

now were back on our feet, and i can actually can afford the car, even at a high rate. ideally what i wanna do is put everything towards the car. since im still in school i really cant move out just yet cuz its cheaper to stay home. so while im finishing school im paying off my car....

think it'll happen??? =/

Odds are against you-- the best way to find out is go to your bank, and apply for the loan now. If they say yes, let them know the car is on order, and you don't need the money for a few months.
If they say no--- then ask them what would make them say yes. They may require a certain amount down. (you could save up??) They may require your score to be at x amount-- You could bust your ass to bring it up (unlikely to drastically raise it in a few months time.


Good luck--- but don't wait to the last minute and then pray you can get the loan. Find out now, and find out what will need to happen to get approved.
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[jfclavel]

Originally Posted by jrc1122

Odds are against you-- the best way to find out is go to your bank, and apply for the loan now. If they say yes, let them know the car is on order, and you don't need the money for a few months.
If they say no--- then ask them what would make them say yes. They may require a certain amount down. (you could save up??) They may require your score to be at x amount-- You could bust your ass to bring it up (unlikely to drastically raise it in a few months time.


Good luck--- but don't wait to the last minute and then pray you can get the loan. Find out now, and find out what will need to happen to get approved.

car's here.... applied at the bank i work, they declined my app, TWICE! right now the dealer is working on gettin me approved but i don't think he's makin much of an effort. went on wednesday with my paycheck stub, downpayment and all that other stuff, said he'd call me.... =P

*sigh* i guess no camaro =/
*sigh* i guess no car =(

[jrc1122]

that sucks...

Find out how much of a down payment would get the bank to say yes, and try to come up with that amount.

Good luck

If they say 10K-- then save until you have 10K and go buy a camaro then.
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Iolite Vaporizer

[jfclavel]

Originally Posted by jrc1122

that sucks...

Find out how much of a down payment would get the bank to say yes, and try to come up with that amount.

Good luck

If they say 10K-- then save until you have 10K and go buy a camaro then.

lol yea i know. 20% down payment means about $8K, which i don't have at this time. they're actually refunding my order deposit, so i'm trying one more thing, but if it doesn't work no big deal. i'll just start saving up for a couple of months, then reorder again... who knows, maybe the z28 will be out or something

appreciate all the advice!

[jrc1122]

why order? why not save up, and find one DFW is a big enough area, you will probably be able to find the color/option combo you want.
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Xxx

[jfclavel]

Originally Posted by jrc1122

why order? why not save up, and find one DFW is a big enough area, you will probably be able to find the color/option combo you want.

true, i got it for sticker tho and it only has 14 miles. so.....

[MarylandSpeed]

One thing to remember is financing a product the dealer sells you just like the car. They sell you the loan at a mark up and pocket the difference. A lot of times they make more money on the financing than when they sell you the car. So when you get a good trade, or low price on a car..they are gonna take it out your butt on the financing. They will make it seem like "they are really pushing the banks and that 8% interest rate is the best they can get"..when in reality they have a 6-7% approval sitting there and they want to pocket the difference.

Also with GMAC, a lot of times they have a choice of a cash rebate, or promotional financing. The dealer however normally will not offer up the promotional financing unless pushed.

I recently purchased a 2500 Duramax, and I left one dealer because they could not get the car I wanted. Also the $2K rebate seemed low. I went to another dealer that had the truck I wanted, and they also told me I had a $2K rebate. When I started to balk, they came back with.."Oh..and if you give up the $2K rebate we can do 3.9% financing through GMAC!". That obviously is a much better deal..but they make less money.

In general..the best rule of thumb is to get approved at a credit union or something before hand. Then walk in the dealer, negotiate for the best out the door price on the car (don't buy on payment, buy on price). Then tell them the financing approval you have and see if they can beat it. When you negotiate price, and financing at the same price, you are setting up to get financed.

My personal opinion is with a 670 or higher credit score, and no derrogatories, and some history, you should be able to get financed on anything..no matter how hard the dealer makes it seem.

[IConnection]

Very smart post by Maryland Speed

[jrc1122]

I've heard that too- But if it isn't GMAC financing-- how do the "pocket the additional amount"

Once you start making payments to the bank, all the money goes to the bank, they don't send any portion of that to the dealership. 8% is 8%

You must be talking about GMAC. Since all the money stays within the GM company. If that is the case, Yes, you should always try to secure you own financing before arriving.
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Cultus

[MarylandSpeed]

When your at a dealer..they put your info in a loan system and banks review the loan and come back with approvals and terms. Something like they will finance 110% of MSRP with so much down at X interest rate. Once that has this in hand, the dealer will then try and sell you the loan in the most profitable way they can.

They come out and say "Great New's Bob, your approved at 8.9%!...man it was hard..but we got it done!". In reality they likely have an approval for 6.9% a few for 7.9% and so forth. They won't tell you that because they want to sell you the loan at a higher rate and profit off it. Unless they are gonna use GMAC, they will normally have you sign a RISC, which is a generic loan contract written in a way that allows them to sell the loan to any bank. If the dealership sells the loan at a higher rate than approved for..that is like found money, and loan is now more profitable for the bank. Once you sign the 8.9% contract, the dealer will sell the loan to which ever bank pays them the highest cut of the loan. It's kinda like a finders fee in way.

This is a great website for those who don't want to be taken by a dealer. (Though on a car like Camaro negotiating power is limited).

http://www.carbuyingtips.com/

Originally Posted by jrc1122

I've heard that too- But if it isn't GMAC financing-- how do the "pocket the additional amount"

Once you start making payments to the bank, all the money goes to the bank, they don't send any portion of that to the dealership. 8% is 8%

You must be talking about GMAC. Since all the money stays within the GM company. If that is the case, Yes, you should always try to secure you own financing before arriving.

[OminouSS]

Maryland speed is right on. To add a little more, you have to understand that your credit has an age too. You are a bit young, but the bank can't grant or deny you based on age. But your credit score tells the story and practically screams your age all over the credit report with non-seasoned account history. I presume you have no revolving accounts over 3 years old with limits of $5,000 & above. However, what I would strongly suggest you do is pay whatever credit cards you do have, down to 60% available balance. That will shoot your score up 20+ points in one cycle (21 days) if you have a couple applicable accounts. They'll in turn probably add a grand or two to your limit, increasing your balance to limit ratio (or the other way, I've forgotten). May as well use that hard earned down car payment money to pay the plastic down as its not going to help you much in terms of car loan approval. Now a days the bank wants to see 30-40% down if you're hoping to earn the approval based primarily on security. Somebody mentioned residual. That is true, however your situation goes a step further in that the bank will look at the likely loan term (60 months??) and want 20% equity in the vehicle at half the length of the loan. That is; they will 'guess' the collaterals' value at 3 years using tools they have even on new model cars such as a 2010 Camaro, subtract the principal payments for 36 months and then apply your down payment. That formula needs to equal 20% positive equity. Very hard to do unless you are putting down $10K+ because your car will continue to lose a huge chunk of value through those first 36 months. This is how a small credit union will do things. You have a better chance with them. If you have not already, march yourself right into whatever credit union you qualify for, open an account and ask to set an appointment with a loan specialist. Fill out the papers and let them throw another inquiry at your FICO history. They are probably going to deny you, but MS is right - ask them what you can do to change their mind. They will probably tell you to get your score up to a 650+ and build your credit history (age your accounts). I know this is not good news, but your income is too low, credit unseasoned, and down payment too low. We've all been there. It takes time to get that first dream car. The generation before you has not made it any easier on you with the predator lending age.

Good luck, bud.

PS - This aint the gospel; just how I understand things to work.

[jfclavel]

its all good advice, really appreciate cuz i can be a little smarter next time. kinda sux tho because i went to another dealership and since i cant get the dream car i wanted, obviously, i decided to lower my demands and expectations for a lil bit right now. decided i should get the base camaro (ls), you know, nothing special, to start building my credit. price of the car is 24k and i was putting down 2k. same info as before, 30k gross income, live with fam, 22 years old, first car purchase.... i couldnt even get the base model. what gives??? first i couldnt get the car i waited for like three months for, then i couldnt get the camaro that hardly anyone wants... last resort is to look into getting a slightly used camaro with carmax... i am NOT getting an AVEO!!!!

ps-ive had my credit cards for 4 years now, i dunno if thats enough age