Trouble getting approved??

[vesi]

I applied with a co-signer, my father, who has near perfect credit.

My credit is around 670 with discharged bankruptcy on it.

Dealer calls me today telling me everyone they tried denied me financing. Asked if I could put more money down, maybe it would help. I cant really afford much more but i offered to do 2000 more, so 5000 down.

I didn't expect to have any trouble at all getting approved with a perfect score co-signer.

They will be calling me back to let me know if the more money down helped but I'm having my doubts.. Is this normal? Would a different dealer make a difference?

[Cmaro214]

really, even with a cosign with great credit....i might be screwed as well. im signing alone and i have a score of 720 i believe but im thinking im not going to be approved capital one already denied me, but i plan on putting 6000 down and possibly a trade in of 4500 or another 4500 on top of the 6000. im not sure if dealers has anything to do with the chances of being approved.

[talwell]

I think in todays credit market any risk to the lender will be a red flag. Despite you having a co-signer with a solid credit score I think they will look back at you as the primary borrower and have to take collections actions with the co-signer if you defaulted.

It would probably be best just to have your co-signer take the loan as you would not be in the picture to affect thier decision.

[garcmol]

Guys, be careful with trying to get financed at several banks at once. I know about 8 years ago in Topeka, KS a dealer did me like that. I had excellent credit (thank goodness), but every app for credit he submitted knocked my score down.

[dstairs]

Originally Posted by vesi

I applied with a co-signer, my father, who has near perfect credit.

My credit is around 670 with discharged bankruptcy on it.

Dealer calls me today telling me everyone they tried denied me financing. Asked if I could put more money down, maybe it would help. I cant really afford much more but i offered to do 2000 more, so 5000 down.

I didn't expect to have any trouble at all getting approved with a perfect score co-signer.

They will be calling me back to let me know if the more money down helped but I'm having my doubts.. Is this normal? Would a different dealer make a difference?

Credit Scores are only apart of the approval process. There has to a reasonable assurance that the car loan will be paid back. The Bankruptcy, could affect it if it is only recent. More likely you father has wonderful credit and a great score, but may a have a debt to income ratio concern if the new car loan is taken on. The nice thing about money down is the more you have invested up front the more likely a bank will invest in you. If you and your father show more than 2 other open car notes, that may also be a concern.

I am curious are you purchasing at MSRP or below? Have you added any extras above and beyond the factory install options on your window sticker? Are they adding a warranty and insurance (which is a great idea)? A lot of times even with good scores if the dealer is selling at a price that is way over the invoice price of the vehicle you will need more money down.

For example in Texas a MSRP of $36,000 after TTL is going to be close to $38,500. If the invoice price is $34,500, you are going to be $4000 over the invoice. Some banks will loan only 80% of invoice which in this case would be $27,600. That is about 40% over invoice. So if one person on the loan is shaky, then you may need as much as $10,000 down IF they will even consider the loan at all. But money talks. With so-so credit most banks will do 100% of invoice or even in some cases 15% to 25% over invoice.

[dstairs]

Originally Posted by talwell

I think in todays credit market any risk to the lender will be a red flag. Despite you having a co-signer with a solid credit score I think they will look back at you as the primary borrower and have to take collections actions with the co-signer if you defaulted.

It would probably be best just to have your co-signer take the loan as you would not be in the picture to affect thier decision.

In theory that is great, however, the deal then becomes a "straw purchase" and can be considered illegal, unless he still lives at home or is on school. Also remember Dad may have his own car note or 2 or 3 notes, and he could also be denied.

[jrboyd_1980]

Originally Posted by talwell

I think in todays credit market any risk to the lender will be a red flag. Despite you having a co-signer with a solid credit score I think they will look back at you as the primary borrower and have to take collections actions with the co-signer if you defaulted.

It would probably be best just to have your co-signer take the loan as you would not be in the picture to affect thier decision.

DO NOT DO THIS. That's a Federal Offense. It's called a Straw Purchase. You can lose the car, and you can get alot of people put in Jail. NO NO NO NO.

[jrboyd_1980]

Originally Posted by dstairs

Credit Scores are only apart of the approval process. There has to a reasonable assurance that the car loan will be paid back. The Bankruptcy, could affect it if it is only recent. More likely you father has wonderful credit and a great score, but may a have a debt to income ratio concern if the new car loan is taken on. The nice thing about money down is the more you have invested up front the more likely a bank will invest in you. If you and your father show more than 2 other open car notes, that may also be a concern.

I am curious are you purchasing at MSRP or below? Have you added any extras above and beyond the factory install options on your window sticker? Are they adding a warranty and insurance (which is a great idea)? A lot of times even with good scores if the dealer is selling at a price that is way over the invoice price of the vehicle you will need more money down.

For example in Texas a MSRP of $36,000 after TTL is going to be close to $38,500. If the invoice price is $34,500, you are going to be $4000 over the invoice. Some banks will loan only 80% of invoice which in this ase would be $27,600. That is about 40% over invoice. So if one person on the loan is shaky, then you may need as much as $10,000 down IF they will even consider the loan at all. But money talks. With so-so credit most banks will do 100% of invoice or even in some cases 15% to 25% over invoice.

Listen to this guy.. Sound Advice.

[Coldpants]

Straw purchases are not illegal when it comes to car sales. But if you default the loan will be on you dad. More information at the link
http://en.wikipedia.org/wiki/Straw_purchase

[vesi]

Originally Posted by dstairs

Credit Scores are only apart of the approval process. There has to a reasonable assurance that the car loan will be paid back. The Bankruptcy, could affect it if it is only recent. More likely you father has wonderful credit and a great score, but may a have a debt to income ratio concern if the new car loan is taken on. The nice thing about money down is the more you have invested up front the more likely a bank will invest in you. If you and your father show more than 2 other open car notes, that may also be a concern.

I am curious are you purchasing at MSRP or below? Have you added any extras above and beyond the factory install options on your window sticker? Are they adding a warranty and insurance (which is a great idea)? A lot of times even with good scores if the dealer is selling at a price that is way over the invoice price of the vehicle you will need more money down.

For example in Texas a MSRP of $36,000 after TTL is going to be close to $38,500. If the invoice price is $34,500, you are going to be $4000 over the invoice. Some banks will loan only 80% of invoice which in this ase would be $27,600. That is about 40% over invoice. So if one person on the loan is shaky, then you may need as much as $10,000 down IF they will even consider the loan at all. But money talks. With so-so credit most banks will do 100% of invoice or even in some cases 15% to 25% over invoice.

It is for MSRP with RS and GFX added on. Just the normal warranty.

My dad doesn't have any open car loans. With 820 credit score.

While the straw purchase sounds nice, I wanted to be on the loan to improve my credit.

Thats another thing listed on the denial record I received, No history of a car loan. And insufficient collateral.

[jrboyd_1980]

Originally Posted by Coldpants

Straw purchases are not illegal when it comes to car sales. But if you default the loan will be on you dad. More information at the link
http://en.wikipedia.org/wiki/Straw_purchase

Straw Purchases are illegal. Unless its your parents and you live with them. I am a dealer. I do this everyday. It falls under fradulant purchase. No go.

[meanmike]

Originally Posted by jrboyd_1980

DO NOT DO THIS. That's a Federal Offense. It's called a Straw Purchase. You can lose the car, and you can get alot of people put in Jail. NO NO NO NO.

How do you figure that is illegal?

[jrboyd_1980]

Originally Posted by vesi

It is for MSRP with RS and GFX added on. Just the normal warranty.

My dad doesn't have any open car loans. With 820 credit score.

Banks aren't looking at that. They are focusing on your bankruptcy which will put you at a higher risk group. You will need to put down money to make it a more less risky for the banks. Going to another dealer will not help. Most dealers in your region all use the same banks.

[jrboyd_1980]

Originally Posted by meanmike

How do you figure that is illegal?

The 45 minute video training that we have to go through every 6 months. It's a fraudulant contract.