topic Re: 630 FICO w/$10k downpayment in Auto Loans

630 FICO w/$10k downpayment

bmartinta — Tue, 08 Jan 2013 20:15:02 GMT

So here is the deal. I have 2 CC chargeoffs from 3 years ago which ruined my credit. I have been gainfully employed for 2 years, paid my car off, opened up $1000 secured visa and pay in full monthly, have no lates for 2 years on anything, current on all my student loans - never been late either. I make pretty decent money ($70k) but my credit scores are still low - which I understand.

My question is what harm will I do if I try and apply for a new auto loan? Like I said I have $10k cash to put down and looking at around a $15-20k loan. Should I take a chance and apply? The reason I am aprehensive is because I was denied for a motorcycle loan ($6k) and had over 50% downpayment, That was back in March of last year. Not really sure why I was denied, but I know my chargeoffs had a lot to do with it.

I could wait till June and I will have had the secured card and paying in full for 8 months on that. However, I was thinking of a trick I could use to get a quick boost in my FICO. What if I took my savings and applied a portion of it each month to increase the balance of my CL on my secured card? After I receive a loan I can then pull whatever I want or need back away from the secured card and back into my savings. There is no fee to do this with my card. Or perhaps should I try and open up an unsecured card and pay on that for a few months.

What do you guys think?

Re: 630 FICO w/$10k downpayment

ds3 — Tue, 08 Jan 2013 20:31:20 GMT

I think you have a very ggod chance of getting financed, albeit at a higher than ideal rate. Don't fret about the motorcycle loan...it's really difficult to finance a bike as they are considered luxury items by many banks.

Best of luck.

Re: 630 FICO w/$10k downpayment

tooleman694 — Tue, 08 Jan 2013 23:36:42 GMT

You will get an auto loan easy. You should probably also get a couple more credit cards. That part of the reason you are scoring so low.

Re: 630 FICO w/$10k downpayment

bmartinta — Tue, 08 Jan 2013 23:59:53 GMT

If I do pick up another CC how long should I wait before applying for an auto loan? I dont want too many dings on my credit.

Also, I should note that the two charged off CC have NOT been paid. One was Chase and is reporting a $0 ballance and the other is Crap 1 and they continue to report a ballance and continue to increase the balance monthly which I beleive is hurting my score.

It is really a catch 22 with these charge offs because paying them will do nothing for my credit. I have let them sit and they will both reach the SOL next month. The total "debt" was only around $1500 combined, however since CAP One has continued to increase my balance for three years it has ballooned to over $1600 on the Cap One card alone. I refuse to pay them and will not pay unless I can deal with Cap One directly which apparently is not an option.

Re: 630 FICO w/$10k downpayment

bmartinta — Wed, 09 Jan 2013 00:02:44 GMT

Would upping my CL on my secured visa help improve my score in the short term? I can up the balance by a lot at once or I can up it by $2-3k ever couple of months. I wonder if the scoring models will catch onto that.

Re: 630 FICO w/$10k downpayment

tooleman694 — Wed, 09 Jan 2013 00:08:20 GMT

If you paid off the Cap one card your score would jump pretty good I bet.

Re: 630 FICO w/$10k downpayment

TrishN — Wed, 09 Jan 2013 00:58:33 GMT

CO with 0 balance. this look good. but if you have CA or CO with balance i guess this will look bad to lender. if you paid ,i guess 90% will be approval

Re: 630 FICO w/$10k downpayment

bmartinta — Wed, 09 Jan 2013 02:53:41 GMT

The only reason why I wont pay them is because I have to go through their contracted CA company; even though CAP 1 still owns the debt. They have gone so far as to say they will not accept payment from me. Ive tried calling multiple times yet they always direct me to some third party company. Chase however has left me alone and sold the debt to a CA who still calls me, but has never reported nor filed for judgement. If I could pay what I "actually" owe and pay it to the OC then I would, but I refuse to deal with a contracted CA when the OC still owns the debt.

Re: 630 FICO w/$10k downpayment

sccredit — Wed, 09 Jan 2013 16:20:26 GMT

bmartinta wrote:
If I could pay what I "actually" owe and pay it to the OC then I would, but I refuse to deal with a contracted CA when the OC still owns the debt.

Unfortunately for you when you didn't pay the debt to the OC the first time around you lost that choice. You can get your ego going full throttle and "refuse" or you can figure out how to get the Collection Agencies off of your report (ie PFD). Otherwise pulling some kind of "trick" won't do you any good.

As far as your first question, yes you should be able to get financed for $25k-$30k with a 630 FICO and $10k down.

Re: 630 FICO w/$10k downpayment

MovingForward_2012 — Thu, 10 Jan 2013 13:28:39 GMT

If you want a mortgage loan (if you don't have one), you will need to pay Cap One but you will have to send a PFD letter to the collection agency that holds the debt. Once a card is charged off, it is purged from the OC's system so even if they wanted to help you, they couldn't. I think the unpaid CO and its increasing balance is hurting your score. Eventually, the balance will drop to zero and a new collection will report causing even more of a sting. Increasing your limit artificially won't be enough to offset this CO...you need to pay it.

Re: 630 FICO w/$10k downpayment

bmartinta — Fri, 11 Jan 2013 00:56:36 GMT

After thinking about this and reading some more I agree that these charge offs need to be paid. I have the cash on hand to pay them and I just want to get this over with. How should I go about negotiating the pay offs? Obviously I want to "settle" but have them report that I have paid the account in full. Can the CA that Cap 1 has contracted remove the "charge off" status from my report? Keep in mind that this CA does NOT report on my account, ONLY Cap 1 reports. Moreover, with regard to my chase account. The CA that debt was sold to does report, but does not report monthly. Can they remove all trade lines from their reporting if I pay in full?

Re: 630 FICO w/$10k downpayment

StartingOver10 — Fri, 11 Jan 2013 02:22:37 GMT

Go to the rebuilding section of the forum and read all about PFD's (Pay for deletes). That will be your best bet.

Re: 630 FICO w/$10k downpayment

TrishN — Fri, 11 Jan 2013 04:04:36 GMT

ok so here you are

1 credit card

2 CO, no CA

is it right?

if yes.

you want to raise your score, all you need to do is:

open another 2 credit card( secured is fine. 3 credit cards and up to max your score.)

keep balance around 5-9%( 1 card report balace only )

like you said 1 more month for SOL expired

then when SOL has beed expired

Send Crap1 offer 80% and up to PFD( in writting) you search for PFD letter

Chase send them a GW and call to find out who holding a debt

wait for another 2 credit card reported to 3 CRA, you will see your score go up.With your credit report is much better than my credit report. But after 5 months i worked on my credit report. i got financed with BMW 8.4 % 0 down. i start with low 600s 11 CO+CA on each CRA

Re: 630 FICO w/$10k downpayment

bmartinta — Fri, 11 Jan 2013 13:55:55 GMT

Thanks for the reply Trish.

A little update. I applied at Western Federal CU and was denied. They claimed the unpaid charge offs as the reason. Here is what is reporting on my CR.

CO 1 - Capital One. Cap 1 holds the debt and reports a new balance every month. They increase it by $18 each month.

Status as ofDate opened [?]Date of last activity [?]Largest past balance [?]Account Type [?]Account holder [?]Industry

Sep, 2012

May, 2008

Oct, 2009

$1,084

Revolving

Individual

All Banks

CO 2 - Chase. Balance is reported as 0.

Status as ofDate opened [?]Date of last activity [?]Largest past balance [?]Account Type [?]Account holder [?]Industry

Mar, 2011

Jul, 2007

Mar, 2010

$1,055

Revolving

Individual

National Credit Card Cos.

CA - Portfolio Recovery. This is who Chase has sold the debt to. They still call me daily, but do not increase the balance.

Status as ofDate opened [?]Date of last activity [?]Largest past balance [?]Account Type [?]Account holder [?]Industry

Aug, 2012

Mar, 2011

Mar, 2010

$1,055

Open Account

Individual

Factoring Companies

Now if my understanding is correct the SOL starts from the Date of Last activity correct? If so then CAP 1 has reached the SOL and I have a few months left before the Chase balance reaches SOL.

All that being said, I just want to pay this off. When I call Portfolio I will ask them to remove the trade line and offer 50% of the balance. Should I offer more or less?

As for CAP 1, I doubt they will deal with me directly and will sent me to the CA they have contracted. Does a contracted CA have the authority to remove CAP 1 trade line? I doubt they do, but you never know. I figure I will offer the same 50%, but not for the current balance and rather the "highest reported balance".

I want to get this done quickly as I am now out of a vehicle. Worst comes to worst I can just pick up a cheap beater car to get me around until I can get this credit stuff sorted out.

Thank you all for the responses.

Re: 630 FICO w/$10k downpayment

TrishN — Fri, 11 Jan 2013 16:26:52 GMT

1 : SOL count From DOFD

2 : dont deal with CA or CO on the phone. you have to send them in writting and copy that contract. when you received letter from them. if they accecpted it, copy that letter and send them western union money oder( copy money oder) and send by certified mail and return received. keep in safe.

here sample PFD letter to CA

Dear Sir or Madam:
This letter is an offer to amicably settle the above account. It is not to be construed as an acknowledgment of my liability for this debt in any form.
I will pay your company the amount of $XXXX as full settlement of this account.
If you accept this agreement, I will send you a money order or certified cashiers check for the settlement amount of $XXXX in exchange for a full deletion of all references regarding this account from my credit profile andfull satisfaction of the debt. This agreement is binding and will be void should you not hold up to your end of the agreement. Furthermore the debt will be deleted from my credit profile at all three credit bureaus, or the bureaus your company regularly reports to in the course of doing business.
If you agree to the above,Agree to never discus this account with any party and never report nor cause to be reported this account to any reporting agency including but not limited to: Experian, Equifax and Trans Union please acknowledge with your signature and return a copy to me. Upon receipt of this signed acknowledgment, I will send you a money order or cashiers check in the amount stated above.
Notice: This agreement is restricted. This is not a renewed promise to pay, but rather a restricted settlement offer only. By not signing below, you agree that the debt has not been renewed nor have any concrete written agreements been exchanged.
Thank You. I look forward to resolving this matter in the best interest for both of our parties.

Creditor’s Authorized Signature: _____________________
Date:_________________
Name: ______________________
Title : _______________________

If you want do it fast. then give them 15 days on the contract for them to delete the account. If is me. i'll send Crap1 a PFD letter too. because crap 1 still hold the debt.

again COPY All letter and payment . PFD letter just send regular mail. if you want to deal with them faster, then is up to up send over night is fine.But payment have to send by CF mail and return received.