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A few questions about car loans...DTI, past credit issues, amount of loan, etc.

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Anonymous
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A few questions about car loans...DTI, past credit issues, amount of loan, etc.

I'd like to start car shopping within the next 6 months. I'm not sure what my credit score is currently; I'll be pulling it once I pay off my credit cards next month. At that time, my DTI will be 43%. I got a mortgage last September and have never been late. My last derogatory was two years ago (30 day late on a CC). I do have student loans, but they'll be in deferment for awhile (2+ years); not sure if auto lenders will ignore those because of the deferment or not? I had a repo in 2004 and bankruptcy in early 2005. I'm hoping to get a car that's between $7000-$10000 and I can put $3000-4000 down.

 

Does this sound doable? I'm starting to think not, but thought I'd get opinions here before giving up completely. I will need A new vehicle soon...if I absolutely must, I can take that down payment and pay cash for a cheaper car, but I'm hoping for something a little nicer and newer if possible. I can swing the payment, but just not sure if I can get a loan.

 

Thanks for any help!

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Anonymous
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Re: A few questions about car loans...DTI, past credit issues, amount of loan, etc.

It is most definately doable. My scores were much lower than yours when we got our current auto loan. I also had student loans which they ignored because they were in deferrment. YMMV depending on the lender though. Dont expect a great interest rate but with $3-4000 down on a $10K car I would say you are good.

 

We put down $3000 on a $9995 car and my score was in the 620's so I would say yes you can get a car. Keep in mind when you pay those credit card balances off it is best to wait a full month or so to expect them all to reflect on your reports. So if you pay them off Aug 1 I would wait until Sept to pull your score and report for the best possible score. Good luck.

Message 2 of 4
thrasher865
Valued Contributor

Re: A few questions about car loans...DTI, past credit issues, amount of loan, etc.

The only hard part is that DTI ratio.  That's a pretty high number to have with the loan included, but I have heard 36% is a better number.  That is a pretty small loan, though, what is your income?  I think the income and the DTI will be the deciding factors.  Good luck.


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Anonymous
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Re: A few questions about car loans...DTI, past credit issues, amount of loan, etc.

My documentable income is low -- that's my biggest concern. My wife does some work that isn't documented and she has student loans too (also in deferment), so she really brings more debt to the table than anything, on paper. My taxable income is only $25,000/year.

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