topic Re: road loans /santander approval 25.24 Apr in Auto Loans

road loans /santander approval 25.24 Apr

djtenn2000 — Sun, 19 Jun 2011 08:06:19 GMT

Let's start this by saying my job requires that I have a vehicle. I, currently, do not have a vehicle and I'm using a rental to do my daily work travels.

Second, is the credit overview and third will be my actual situation for advice in this post.

Credit breakdown:

NEGATIVES:

$139k student loans remaining. all currently deffered (debt to income is 103)

collections accounts include a $5800. medical bill as the highest. There are several other medical related collections as well (about 7 total)

Other: charge off credit card: 486, collection account (for credit card; $654).

A week ago, several duplicate collections entries were removed as well as a $102 collection account. (I called the company, offered to pay it in full if it were deleted from credit altogether).

The only good: several paid off student loans (over five years ago) and one paid off loan for a vehicle I had 7 years ago.

I stopped using my credit in 2007 because I had such high student loans that each time I applied for credit, I got denied largely because of the loans being so high. Nevertheless, collections that appeared last year were the only recent activity because I could no longer afford to make payments. Within a month, they were on my credit as collections.

Here is the situation:

I applied for a car loan through GM and was denied. my score was 590/equifax. The same day, I applied with Roadloans and Capitol One. I was approved by roadloans and received their loan agreement. The Equifax score was 584 on that application. So, the next day, I spoke with a Nissan/BMW dealer and he told me that all I needed was a 575 to be approved for financing. I allowed him to pull my score and I was denied because the score was 557/Equifax (and even lower for T.U. and Experian).

I was perplexed at how my score would drop over 40 points in one day with four inquires. Turns out that the score really did take a hit, mainly because my credit had not been pulled in well over a year & it was bad. So, it had an immediate impact in my attempt to get auto financing.

Thus, I am stuck with a loan agreement from Roadloans/Santander, which I have not signed off on, that will finance $15000 w/$1200 down on used vehicle between 04 - 10 with 60k or less miles. The interest rate is 25.24%, which is $1 for each dollar financed. I have gone to ten dealearships in a week and I have not found one single vehicle that will fit the terms of their loan. Each dealership representative tells me not to use the loan because the interest rate suggests that I have had two repos and a bankfuptcy...and I have not. They all feel that I can get a much better rate if I look harder in other places, but searching for auto financing is not my thing. I, generally want to ask any bank/financer what their credit score requirements are, plus interest rate floor & ceiling. I refuse to have my credit pulled for at least one month at this point. I feel that anyone who wants to consider me, face to face, can review the credit report I've already pulled to make any preliminary decisions.

What kind of options do you think I have regarding the auto loan delimna?

Situation #2:

Of course! I pulled my credit and scores. But it wasn't until I pulled my FICO that I got an idea of best plan of action to try and improve my score as quickly as possible. I don't know how well the score simulator works for predictions, but it 'suggests' that I pay 20% of the total outstanding debt on the two credit cards I mentioned earlier, and in one month, my score will increase to 577 - 617 range, which is an automatic increase of 20 points from now.

I only have two cards on my report. One show as a revolving closed/charge off account ($486). The other shows as an 'other' collection account ($654). I called the first account and paid 20% on the balance already. I will be receiving a payment letter that I can send to Equifax. But the second company says they don't send any type of payment letters until the account is paid/settled in full. So, I told the representative that it was pointless for me to pay any amount unless it was the full amount, which I can't afford at the moment. What I am considering, is to make a small payment, then dispute it on my credit file. If the company doesn't update it, then it will likely be deleted...right?

Back to the score simulator: I'm considering paying more on the first account so that my overall balance will reflect a full 20% reduction---eventhough a payment will, likely, only be reflected on one account. Do you think that will generate the same score increase?

Summary: I would appreciate an informed and objective reply. Please don't disrupt your replies to me with subjective/heckling/smart-mouthing comments. I am looking for informed advice only about what I have presented to you. Please be respectful of that if you choose to reply.. Thank you.

I'm only tracking my Equifax score. It is currently 560.

Re: road loans /santander approval 25.24 Apr

usmc58555 — Sun, 19 Jun 2011 23:06:37 GMT

Please answer some questions:

1-Age

2-income, gross monthly

3-Time with current employer

4-Current car obligation/monthly rental

5-miles put on car each month/week

6-What work do you do

7-Single, married, or in committed relationship

8-Type of degree (4, 2, or 6 year attained)

9-expenses, rent etc monthly

until we know more there is no real advice that can be given.

Re: road loans /santander approval 25.24 Apr

djtenn2000 — Sun, 19 Jun 2011 23:06:10 GMT

Please answer some questions:

1-Age 37

2-income 45k

3-Time with current employer 1yr 1mth

4-Current car obligation/monthly rental 200/wk

5-miles put on car each month/week 1200

6-What work do you do territory product mgr

7-Single, married, or in committed relationship single

8-Type of degree (4, 2, or 6 year attained) masters

Re: road loans /santander approval 25.24 Apr

usmc58555 — Mon, 20 Jun 2011 22:51:07 GMT

OK.

Had to mull this overnight.

1- I asked some additional questions right as you answered my first set.

You made a great plea for information, but with just your score no one can give you advice. So if you can answer that as well maybe we can offer some advice

Btw how much is it costing you a month to service your sudent loans?

How much are all your monthly obligations including student loans but not including the $800 a month you are spending on a car?

Are you really making Gross only $45,000 a year?

2- You want a positive upbeat non negative answer. I'm not sure I can give you one. At some point a terminal cancer diagnosis is a terminal cancer diagnosis.

3- If you are in student loan debt for $105K and are only grossing $45K you may be one of those people, assuming you are working a job in the field you graduated in, who took on more student debt then the job you were going into could pay.

Now if you are underemployed in that sector, OK. but after a year you should be looking elsewhere-that income seems unsustainable.

Here are the facts:

You only make 45K a year which is $3,750 prior to taxes, health insurance and retirement. If your loan service is 700 You are making what nothing after paying the 800 on the car and car insurance.

Now lets do story time:

A "friend" of mine went to John Carrol University and charged up more then $105,000 in student loan debt to be a lawyer and took a job as a prosecuter for the city of Cleveland. He makes less then $55,0000 a year, He waits tables in the same county he prosecutes in at a national chain restaurant every Friday night as a closer, then Saturday on an open to close to help pay his bills. He is expecting his time as a prosecuter to lead him to a judge ship or a much more lucrative career in private practice as a criminal defense lawyer, but right now yeah he does what he has to.

With the score you have, and a lack of positive information, and the income you have with the debt you have I do not see you getting any loan but what you have been offered. the numbers do not work. And the numbers do not work in more then your credit score but more along the point of free income to debt.

If you are making 45K a year and servicing a student loan of $105K i just do not see you looking like a viable buyer.

Options:

And I must say at 45K a year I have to assume you are getting a car alotment since your employer has to know you are burning through car value and gas like I go through toilet paper.

the $800 a month renting a car is definately killing you and keeping you on the treadmill without going anywhere. The actual good thing about it, you are not worrying about maintenence and depreciation. I do not know if a $3,000 beater car can keep up with the miles.

a- Secure a co signer, family, friends or relatives and buy a new small cheap car, or a used one at conventional rates

b-secure a much larger down payment half down should get you bought anywhere at a better rate

c- save and buy a beater car with cash, that will at least free up $800 a month and lead you to be able to save money to buy a better car in cash

d-buy lottery tickets

e-look for a part time job to help stretch your income. Waiting tables, gas station cashier whatever.

f-consider a buy here pay here

g- consider taking your degree and going officer in the military with some kind of tuition repayment bonus.

h- change jobs/move if you have to completely to make more and get you debts (DTI) under control.

i- consider a Buy Here, Pay Here that will report to the bureaus, but ultimately the miles you are putting on the car is going to kill the models most BHPH sell.

j- Definately consider a local credit union. Do some research. Yuo probably are going no where at below 600 but if you can get higher maybe.

You want an answer thats going to be Roses and Kittens and with the information I do not see one happening outside lottery win, inheritence, or someone who rented the car you just got into leaving $20,000 in the trunk.

Re: road loans /santander approval 25.24 Apr

p- — Mon, 20 Jun 2011 22:53:25 GMT

A newer car should be a long way down your list. Buy something used for about twice what you have saved up, then bank your current rental amount, and use it to either save up for a new car or pay down debt. Or if you can, borrow a car from a family member for a couple months to save up some money.

Or buy a motorcycle, save on gas and the sticker price.

Use the information here to figure out how to improve your credit, and whatever you do don't sign up for a bad car loan. It will haunt you.

Re: road loans /santander approval 25.24 Apr

usmc58555 — Mon, 20 Jun 2011 23:05:02 GMT

p- wrote:
A newer car should be a long way down your list. Buy something used for about twice what you have saved up, umm how is he going to buy a car worth more then he has saved up? then bank your current rental amount, and use it to either save up for a new car or pay down debt. Or if you can, borrow a car from a family member for a couple months to save up some money. The 1200+ miles either a week or month hes putting on it is a little excessive for a family member to loan a car out to.

Or buy a motorcycle, save on gas and the sticker price. probably does not work with his regional manager/supervisor position

Use the information here to figure out how to improve your credit, and whatever you do don't sign up for a bad car loan. It will haunt you. Actually a "bad" loan through Santander could be less then what he is paying now. the issue is if the car they will approve can handle the miles up until it gets paid off.

Re: road loans /santander approval 25.24 Apr

p- — Mon, 20 Jun 2011 23:13:18 GMT

usmc58555 wrote:
p- wrote:
A newer car should be a long way down your list. Buy something used for about twice what you have saved up, umm how is he going to buy a car worth more then he has saved up? Finance 50%, the payments will be lower, and with what he saves from the rental he can pay it off in a couple of months. When I was an Area Manager for a retail company I drove a 500 dollar car for two years, then bought a 7k car at a small dealer with dealer financing because of my credit.. then bank your current rental amount, and use it to either save up for a new car or pay down debt. Or if you can, borrow a car from a family member for a couple months to save up some money. The 1200+ miles either a week or month hes putting on it is a little excessive for a family member to loan a car out to. Possibly.

Or buy a motorcycle, save on gas and the sticker price. probably does not work with his regional manager/supervisor position Maybe not, depends on where he lives. I ride one, and am an Operations Manager for a large company. You can get a really nice used bike for 3-5k.

Use the information here to figure out how to improve your credit, and whatever you do don't sign up for a bad car loan. It will haunt you. Actually a "bad" loan through Santander could be less then what he is paying now. the issue is if the car they will approve can handle the miles up until it gets paid off. Better to get a short term solution now and work on the credit file, and buy better later. At 45k a year with all those loans outstanding he can't have it all. That's a recipe for disaster. I recommend patience, based on my personal experience.

I wonder if he is getting mileage reimbursement from his job that would offset the cost?

Re: road loans /santander approval 25.24 Apr

djtenn2000 — Tue, 21 Jun 2011 01:43:03 GMT

haha! I love the terminal cancer diagnosis comment. HILARIOUS! but true..

I thought I provided as much detail as possible. But, maybe this will help as well.

Student loans will never exceed $250/mth...they are all in defferment and will likely be reduced to a lower amount when the deferrment ends. I manage those loans very well and I am not trying to pay them off at the cost of having a sub standard life. In other words, the government believes that I should always be able to obtain necessities like, food, clothing, shelter, transportation without the student loan burden weighing it down. Hence, they work with me and I make sure they keep a current status.. (it's very easy to manage student loans).

My monthly income includes my reimbursement package from my job for the use of my vehicle. I have incentives as well, but I've only disclosed what I've made so far this year after taxes and health benefits, which is $19k as of May 2011. I do not have cost of living expenses as I live in a house that's bought & paid for by my parents. My utilities are also paid as well (when I was younger, I contributed a lot to my parents well-being..so they are returning the favor so to speak)..So, I'm in a position to do some serious improvements to my credit. But, most of this year was focusing on bills that are NOT on my credit to make sure they stay off. So where is my money going you may ask: bills & work mostly. However, I have MORE than enough income to make a $400/mth car payment. And, even though I will be able to rent a car for less than $150/wk starting next week, I do not think it's feasible because it takes away money that I could be saving as down payment. Also, I agree with you that using a family vehicle is out of the question when I will be putting on nearly 5000 miles a month. That's just absurd.

So, to summarize, income is $45k---after all deductions. Again, that's is based on no other bonus incentives.

I am looking at a used 2006 vehicle with 32k miles. My Equifax is 560; needs to be 575 to be approved @16% apr financing with $2k down payment.

What I have already approved is Roadloans/Santander $15k @25.24%apr with $1200 down. While my credit is not bad, it's not shot to hell to be FORCED to accept this Santander offer. I made this post seeking advice on whether I could find something better (at least 18% apr) or if the reality of my credit is just to accept the offer and work around it till I can refinance the vehicle. by the way, I live in one of the poorest counties in the nation...so yea, I definitely underemployed, but this is the first bonafide job I found afte nearly 18 months of no work at all.

If I didn't mention in the original post, I had an accident in my vehicle a few weeks ago. It was a 95 tacoma--not worth much (but it was paid for). So, this is about timing. I had not intended on saving for a car till September of this year, with a plan to purchase in February of next year. But, I GOTTA DO IT NOW! And I just don't want to take the bad loan terms unless I really have no other options.

Again, my credit has been terminal, but it's revivable (lol!). If all that is needed is current activity on those old credit card accounts..so be it.

I hope that helps.

Re: road loans /santander approval 25.24 Apr

knr — Tue, 21 Jun 2011 17:21:54 GMT

Is it possible to refi after a few months if/when the situation improves?

Re: road loans /santander approval 25.24 Apr

p- — Tue, 21 Jun 2011 17:44:16 GMT

knr wrote:
Is it possible to refi after a few months if/when the situation improves?

That's a good suggestion; It depends on the bank and amount owed compared to the value of the vehicle, there will be restrictions. Also, some banks have a mileage limit on what they will finance for a used car. It might be a good idea to look into the bank he's planning to refi with and see what their limits are.

Re: road loans /santander approval 25.24 Apr

usmc58555 — Tue, 21 Jun 2011 19:27:11 GMT

seeing as you are in such an enviable situation, take the loan offered and pay off arly.

Re: road loans /santander approval 25.24 Apr

djtenn2000 — Wed, 22 Jun 2011 05:57:19 GMT

The refinancing is a great option, but won't I still be paying a LOT for the car since I would be getting a lower rate on the original loan?

I appreciate everyone's input and I think I will follow the advice to just take the loan and deal with it. There are other circumstances that I've not revealed, but I don't think they affect the outcome of the advice you all have given.

Does anyone know costs associated with owning a hybrid vehicle? I'm looking at an 06 Honda Civic Hybrid. It's $13K with less than 40K miles on it. I was thinking with the kind of miles I drive, it would be a superb choice. any input?

Re: road loans /santander approval 25.24 Apr

Caliche — Sat, 25 Jun 2011 04:26:28 GMT

My commentary is probably not welcomed but it's a sad state of affairs that someone has to go into 6 figure debt to an instituion of higher learning to obtain an advanced degree just to make 45k a year at the age of 37. Different strokes for different folks and all but if I were you I think I might uproot and head for greener job markets.

Re: road loans /santander approval 25.24 Apr

djtenn2000 — Sat, 25 Jun 2011 15:33:22 GMT

You're right.. your commentary is not welcomed because it is subjective and has nothing to do with my post. No need to comment further unless you like seeing your words on a screen because I won't be responding. But, I did want you to feel acknowledge for what I, specifically, asked people NOT to do when replying to the situation that I was seeking advice. I hope you feel good sitting on your 10-foot high judgement pole.

Now back to the situation at hand.

Re: road loans /santander approval 25.24 Apr

p- — Sat, 25 Jun 2011 17:05:48 GMT

Caliche wrote:
My commentary is probably not welcomed but it's a sad state of affairs that someone has to go into 6 figure debt to an instituion of higher learning to obtain an advanced degree just to make 45k a year at the age of 37. Different strokes for different folks and all but if I were you I think I might uproot and head for greener job markets.

Irrelevent manifesto follows:

A college degree is not an instant path to a six figure income. It is just a qualification on your resume that can open additional doors for you. I never finished my degree; I was managing a nightclub at night and trying to do school during the day and it was damn near impossible. I managed to use that management experience to work my way up in leadership in different fields until I ended up in executive leadership at the company I work now. I get paid very well, but my career options are limited. Even with my experience, many companies won't look at me without a degree. I now find myself in a position where I may go back to school in my 30's just to have more options open to me.

Someone fresh out of college without a lot of experience will have to start at entry level and work their way up just like I did. The difference is the number of choices they have, and paths open to them that are not open to someone like me. Someone my age who finished an advanced degree right out of high school and had my same work experience would likely qualify for a higher paying job than the one I have now. In terms of the long game, that person wins. He or she will make more than me even if you subtract what they paid for their education.

Of course, in the short game I think I won. That same student was up all night cramming for finals while I was on a band bus on the way to Vegas, just because I could... A year they spent living on top ramen and hitting the books was the year I spent working as a ski patroller and bartending 3 days a week, and spending the other 4 traveling around the NW and Canada with a snowboard strapped to the top of my beat up camaro in search of fresh powder.

That being said, the path I took led to success, but for many who took the same path it did not. Your odds are much better with a degree, and I advocate college to my children. All in all, it's a gamble either way. You choose your own path and the odds you are comfortable with, and will be responsible for the results.

Re: road loans /santander approval 25.24 Apr

usmc58555 — Sat, 25 Jun 2011 21:31:44 GMT

Caliche wrote:
My commentary is probably not welcomed but it's a sad state of affairs that someone has to go into 6 figure debt to an instituion of higher learning to obtain an advanced degree just to make 45k a year at the age of 37. Different strokes for different folks and all but if I were you I think I might uproot and head for greener job markets.

I agree.

Re: road loans /santander approval 25.24 Apr

usmc58555 — Sat, 25 Jun 2011 21:45:14 GMT

djtenn2000 wrote:
You're right.. your commentary is not welcomed because it is subjective and has nothing to do with my post. No need to comment further unless you like seeing your words on a screen because I won't be responding. But, I did want you to feel acknowledge for what I, specifically, asked people NOT to do when replying to the situation that I was seeking advice. I hope you feel good sitting on your 10-foot high judgement pole.

Now back to the situation at hand.

myFICO forums TOS is that you/all will be friendly supportive and respectfull.

You are also a participant in a PUBLIC forum. Once you make your case and situation known you do open yourself up for anyone who is a member to chime in and say whatever they want up to and including missing your point entirely or heck going on in paragraphs about Basset Hounds. We are not paid participants here and the advice is what it is.

I posted an experience I had with Chase last week and had to endure pages of people telling ME how stupid I was in both how I paid my bills and paying my bills.
http://ficoforums.myfico.com/t5/Credit-Cards/Chase-payment-Due-Today-Sat-paid-in-cash-and/td-p/949310

this is not a heavily moderated Forum- it is moderated but there is some lattitude. Probably because they do not pay the moderators here. If you want to see a highly moderated Forum I implore you to go to Television Without Pity and participate there. You will probably be on suspension in the first week and may make it a year before they terminate your account.

if you want to partcipate and get targeted advice that is only what you want to hear I suggest you go visit a Fianncial Planner that you can pay by the hour.

Re: road loans /santander approval 25.24 Apr

djtenn2000 — Sun, 26 Jun 2011 10:50:38 GMT

@usmc. I got the advice I was seeking..mostly from your 'respectful' replies, which I appreciate. Actually, EVERYONE who responded, clearly read the end part of my original post about not seeking 'subjective' comments, except the last person who opened the door for judgemental b.s. To that, I have no further comment other than, each life is different and we make the best as it changes towards things we are not prepared for and have to react. I've made good decisions and bad ones, but mostly good decisions, including posting int his forum. However, I will not let another person present judgemental opinions where it's not warranted. If that's mannerable enough for you or the majority of this forum, then I wish you all the best...because before I posted, I read all the 'unecessary' comments that ppl made. It's just a distraction to getting to what you 'need'. Perhaps all of you who don't have the problem and feel the need to speak holier than thou, should remember when you DID have the problem. If you never had the problem, then you shouldn't be here in the first place.

Be helpful..not judgemental. If I wanted judgement, then I'd seek God or 'a friend'. Have a good Sunday. This post is closed for discussion on my end. And thank all of you who were kind of enough to be helpful.

Re: road loans /santander approval 25.24 Apr

UncleRay99 — Sun, 23 Dec 2012 18:47:20 GMT

Buy a car that retains its value regardless of miles driven (civic hybrid is great), establish a relationship with a credit union, save up a few thousand dollars and use the money as a refi down payment with the credit union one year later.

Get a secured credit card immediately and treat it with respect. Between a consistently paid car loan and credit card your credit score within a year would rise 100 points. The credit union would seriously consider refinancing at a single digit APR with a solid recent payment history, a score of 650, and a down payment that would give the car significant equity. There is a limit to how high your credit score will increase due to your current debt/income ratio.

Re: road loans /santander approval 25.24 Apr

maiden_girl — Sun, 23 Dec 2012 20:31:42 GMT

I don't suggest taking that loan! If you can, try sending GW letters to your paid/settled collections and you will see a jump in your credit. Maybe not a lot but you will see something! Santander has a bad rap!

I would definitely look into certified used cars from a dealer. They will meet the requirements of the loan if you are pre-approved! Also look into rental agencies that sell their cars. They are required to sell their cars once they reach about 40k miles.