topic Re: First Time Auto Loan- Chances of Approval????? in Auto Loans

First Time Auto Loan- Chances of Approval?????

emshook — Sat, 06 Oct 2012 21:47:43 GMT

Hello, I'm new to this forum and will be buying a new car in the next month or so.

I sold my car for $3000 and have until Nov. 15th to find a new one, so this will be my down payment.

I'm nervous about financing because it is my first auto loan and my credit scores aren't that great.

I just pulled scores today, and Equifax is showing 645 and Transunion 676. (free credit report was showing Experian- 685, Equifax- 685, Transunion- 681)

I'm looking into getting a Honda Civic, Toyota Corolla, or a Hyundai Elantra, so something under $20,000

I have a stable job and make around $42k a year. I have student loans and cc debt- that's what's hurting my score so much, and the length of my credit history. I have no late payments, and 1 collection from 3.5 years ago from th university health center (was only $70 and was paid)

What are my chances of getting approved, let alone what kind of interest rate am I looking at?

Re: First Time Auto Loan- Chances of Approval?????

Elcid89 — Sat, 06 Oct 2012 22:13:15 GMT

You chances of approval should be good with your cash downpayment and your scores. Your rate will vary depending on the lender. The F&I guy will normally shop the paper around trying to get you the best rate, so try and see what he can come up with.

Re: First Time Auto Loan- Chances of Approval?????

jd5189 — Sun, 07 Oct 2012 03:41:45 GMT

I think you have a good shot at approval! Good luck!

Re: First Time Auto Loan- Chances of Approval?????

emshook — Sun, 07 Oct 2012 04:04:55 GMT

I was thinking about going to a credit union first. There's probably no way I would qualify for the specials with 0% or 1.9% financing, is there?

Re: First Time Auto Loan- Chances of Approval?????

Revelate — Sun, 07 Oct 2012 04:55:09 GMT

emshook wrote:
I was thinking about going to a credit union first. There's probably no way I would qualify for the specials with 0% or 1.9% financing, is there?

Not certain on this, Toyota (TFS) and likely other dealer lenders have some aggressive promo pricing right now, this is perhaps especially true if you're willing to pickup a 2012 model which I'd really recommend anyway in Nov/Dec when you're trying to get a first auto loan done. Dealers will be absolutely incented to try to get you financing rather than a 2013 which are moving off the lots by the lease / rapid turnover folks.

I'm not certain from your post if you were looking used or new, but special financing is usually on new cars from the manufacturer's financing arm.

That said, even if you dn't get a great interest rate out the gate (you may not, the first time buyer penalty is non-trivial on an auto-enhanced score), you can refi anyway... and I absolutely recommend attempting to secure financing from a local CU. Having a relationship with a decent CU is nothing but goodness when it comes to your financial future.

Also, welcome to the forums!

from what ive read tfs is 650 for top tier financing. but...

creditnocash — Sun, 07 Oct 2012 05:29:52 GMT

from what ive read tfs is 650 for top tier financing. but the guy at the dealer told me i just made top tier with a 708. (700 being qualifing for top tier)

i belive i read honda was 680.

Re: First Time Auto Loan- Chances of Approval?????

emshook — Sun, 07 Oct 2012 06:29:21 GMT

I'm definitely looking for a new car. Thank you everyone for the advice so far!

Would my auto enhanced score be a lot lower since I've never had an auto loan before? That's what I'm worried about, and now that I sold my car i really do only have the 4-6 weeks to buy so not any time to raise my score.

Re: First Time Auto Loan- Chances of Approval?????

Elcid89 — Sun, 07 Oct 2012 06:54:11 GMT

emshook wrote:
I was thinking about going to a credit union first. There's probably no way I would qualify for the specials with 0% or 1.9% financing, is there?

That one is a toss-up question, but if I had to guess, I'd guess that you have a better shot at a premium tier with a captive lender as opposed to a credit union. You can always try both and choose the better package.

Inquiries for auto loans within any 45 day period count as a single inquiry for the purpose of calculating your score, so you have some leeway to shop around. I'd shop it to the credit union and have the F&I guy at the dealer shop it to all of his buyers. See what comes back.

Re: First Time Auto Loan- Chances of Approval?????

Shogun — Mon, 08 Oct 2012 01:49:36 GMT

The approval I don't think is in question, it is the rate that the purchase can be made at. You will get approved, but you want the best deal. That old CO, have you sent a GW to them to see if they'll delete? That could give you a boost!

Re: First Time Auto Loan- Chances of Approval?????

creditnocash — Tue, 09 Oct 2012 22:40:15 GMT

emshook wrote:
I'm definitely looking for a new car. Thank you everyone for the advice so far!

Would my auto enhanced score be a lot lower since I've never had an auto loan before? That's what I'm worried about, and now that I sold my car i really do only have the 4-6 weeks to buy so not any time to raise my score.

its a ymmv thing.

ive never had any installment loans and pulled my credit from here the morning of and dealership pulled my reports about 2 hours later.

tu was 690 eq 689 dealer said it was 708 tu pull.

even though later i saw they pulled all three of my reports twice! (one from dealer and one from toyota financial)

Re: First Time Auto Loan- Chances of Approval?????

emshook — Fri, 12 Oct 2012 05:21:31 GMT

I finally applied for financing yesterday!
The Mazda dealer approved me for 4.99% for 72 months.
The Toyota dealership got me 3.9% for 60 months.
Then I got a call from the Hyundai dealership finance director and he said he got me a great rate of 6.9%.
So I told him that wasn't that great considering i got 3.9% and 4.9% from the other two places. Then he told me those weren't real rates and that those dealers would increase the interest rate once they got me in to sign the papers. He told me he only saw the dealer inquires on my credit report and not the ones from the banks.
I don't know who to believe. Does anyone know if the finance manager is right?

Re: First Time Auto Loan- Chances of Approval?????

ImprovingYouth — Fri, 12 Oct 2012 15:11:50 GMT

emshook wrote:
I finally applied for financing yesterday!
The Mazda dealer approved me for 4.99% for 72 months.
The Toyota dealership got me 3.9% for 60 months.
Then I got a call from the Hyundai dealership finance director and he said he got me a great rate of 6.9%.
So I told him that wasn't that great considering i got 3.9% and 4.9% from the other two places. Then he told me those weren't real rates and that those dealers would increase the interest rate once they got me in to sign the papers. He told me he only saw the dealer inquires on my credit report and not the ones from the banks.
I don't know who to believe. Does anyone know if the finance manager is right?

I wouldnt pay attention to that, however I LOVE my 2011 Sonata, I think hyundais are very solid cars and IMO mazdas suck. As far as the lenders the only way to find out is to get in there and find a car and get into the process. YOU HAVE THE POWER, YOU ARE THE ONE BUYING!! Do not forget that if at any point in the negotiations they tack something on or they increase the rate or anything WALK OUT!!!! That's all you have to do, if they are BSing you just go somewhere else. They will test you and get over on you IF YOU LET THEM. You have to come in firm, tell them if they cannot keep the 3.9/4.9% original offer, then you will go elsewhere.