22% downpayment not enough?

[Army275RGR]

The dealership said my score was 601(higher than what i get myself from experian), I told them I had $10000 to put down on a car listed at $44615. My trade in is still financed but no negative equity was going to get rolled over(about even)....Ive made 20 on time payments on my present vehicle, pay all my bills on time for the last two years. They said I could not get financed for the ammount needed.

Really? I can prove a monthly income of 5000 a month for this year so far. Not sure if they took me serious or what because I did not have the cash in hand (I do have it and more) but i don't get them. I do have a crap credit history I wont deny this, but Ive been a saint for the last two years, I would think the banks would see this as a positive.

[azguy13]

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@Army275RGR wrote:

The dealership said my score was 601(higher than what i get myself from experian), I told them I had $10000 to put down on a car listed at $44615. My trade in is still financed but no negative equity was going to get rolled over(about even)....Ive made 20 on time payments on my present vehicle, pay all my bills on time for the last two years. They said I could not get financed for the ammount needed.

Really? I can prove a monthly income of 5000 a month for this year so far. Not sure if they took me serious or what because I did not have the cash in hand (I do have it and more) but i don't get them. I do have a crap credit history I wont deny this, but Ive been a saint for the last two years, I would think the banks would see this as a positive.

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I think pre-2008 that would have been good enough. However, these days it is tougher. We will need more info from you to give you a reasonable answer. Prior to your 2 years of perfect history, what does your credit profile look like? Did you have multiple late payments? If so, what were the late payments on (i.e. credit card, car loan, mortgage).

Also, what is your Debt to Income ratio? Just because you make $5,000 a month does not mean that in the eyes of a bank, you can afford an additional payment. 

[Army275RGR]

Lots of missed payments, collections...etc...etc loans and credit cards. What a person with a 561(according to experian) would have. I literally own everything I have except my truck because of my irresponsibility. I have ONE credit card and it's a secured card from wells fargo with a 300 limit. Its paid off right now.  I was trying to buy a 2014 SRT 8 Challenger btw. Great car, awesome power.....but I cant have it. Boy it sucks having a terrible history of credit, i really feel this system is in need of an update to reflect a persons true capacity to pay off a loan.

[StartingOver10]

Go to the rebuilding forum and see what you can do to clean up your reports before you buy.

What the credit score measures is past history - which really would not be capacity to pay but willingness to pay. Capacity is measured through paystubs and bank statements.

Doesn't matter how much capacity you have if you don't have the willingness.  That is what scares lenders. You might try a CU to see if you can get an approval there because you have recent history showing willingness to pay over the past two years. You might have to start with something that is less expensive so the LTV is much  lower than 78%. Or come up with a larger down payment for this vehicle to get to a lower LTV. The lender's risk is mitigated when you put down more money. A bad credit history can be overcome with large down payments most (not all) of the time.

[coterotie]

If you have that much cash you need to put at least 1K on deposit on the secured card and see if you can get a an unsecured card from Credit1 or somebody.  2 positive trade lines and a limit over 1K will bump your score.  You may have made 20 on time payments on your current vehicle, but were you past due at any point on that loan?  If so that is what scared them off.  It may take another year of work if that is the case.

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@Army275RGR wrote:

Lots of missed payments, collections...etc...etc loans and credit cards. What a person with a 561(according to experian) would have. I literally own everything I have except my truck because of my irresponsibility. I have ONE credit card and it's a secured card from wells fargo with a 300 limit. Its paid off right now.  I was trying to buy a 2014 SRT 8 Challenger btw. Great car, awesome power.....but I cant have it. Boy it sucks having a terrible history of credit, i really feel this system is in need of an update to reflect a persons true capacity to pay off a loan.

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[Army275RGR]

Never been late on my current car loan, if anything I always pay early. Its okay, i'm sure they get down payments like that through the door all the time.

[coterotie]

Hey my score was in the 700's and USAA wanted to charge me 12.9% on a used BMW with a 50% down payment.  On a different car BMW flat turned me down regardless of down payment.  Remember, it isn't the dealer making the decision.

Back when I was a lender and we didn't rely on scores for decision making, we called what you have "sloppy credit."  If you had substantial assets/reserves, a high income and a decent history with us we'd write paper on you.  But if you were even 1 day late, I would send the hook for your car.  No phone call, no letter.  Usually grab it from the parking lot where you worked.  Pay my fees and get the car back.  I might let you get away with this a couple of times.  AFter the third time, you don't get the car back.

Lending was personal back then, not that way today.

Strongly suggest taking my score improvement advice as well as getting in with a good local credit union.

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@Army275RGR wrote:

Never been late on my current car loan, if anything I always pay early. Its okay, i'm sure they get down payments like that through the door all the time.

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[Army275RGR]

Ill take the advice and keep saving money. I really thought i was a good potential customer lol.

[jaebsf]

No disrespect intended. But why would someone who makes 60K want to drive a 45K car? Sounds like you want a status symbol and not just reliable transportation. If you have 10K sitting around in cash I would payoff any interest accuring debt and put the remainder, if any, in some safe depository instrument.  I would advise a clearer look at your priorities. Or, if you really want a new car that bad and don't care so much about debt take your 10K and tradein value to buy that new car and not owe anyone a dime...minus the car loan you have now. Yeah dude, if you're real you need to think about this. It seems that possible leaders have....leading to your question. They must see very high risk in what you propose.

It would seem that possible lenders have answered your quesiton. "22% downpayment not enough?" They have clearly answered, "No". You need to ask youself why.

[CreditDrama85]

i agree with jaebsf it sounds like your income isn't enough to support it. IMHO the most you could get financed for given your income and CS would be 30k and you might want to consider looking for something cheaper than that. Good luck with whatever you decide