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Can't get financing with 700+ Fico 8.

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EddieK
Established Contributor

Re: Can't get financing with 700+ Fico 8.


@Anonymous wrote:
Thanks for all the replies. I went to a few dealers and got several approvals. First approval was for a 2010 civic si at 16.9 apr. Ended up taking home a 2009 VW gti at an amazing 6.5 apr through capital one. They made me get the 2 year powertrain warranty for the low rate. They pulled a 726 through their scoring. As a first time car buyer, im pretty happy and think i fot a great deal. Let me know what you guys think.

APR sounds good in your situation, but we need more info to determine if you got a good deal.  Cost of car?  mileage?  etc.  And they can't 'make' you buy a warranty to get a certain APR.  But in the end if you're happy with the deal, than it's a good deal for you.

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Message 11 of 18
Anonymous
Not applicable

Re: Can't get financing with 700+ Fico 8.

It has 88k miles and was 12,500 out the door then 3000 for the 2 year/24000 warranty. So 15,500 in all. Put 3000 down bringing the financed price back down to 12,500. According to the dealership capital one was willing to offer 6.5% with the warranty and 10% without. Probably should have just taken the 10%, but this is day one and the check engine light came on. Hoping its not serious, will know more tomorrow.
Message 12 of 18
StartingOver10
Moderator Emerita

Re: Can't get financing with 700+ Fico 8.


@Anonymous wrote:
It has 88k miles and was 12,500 out the door then 3000 for the 2 year/24000 warranty. So 15,500 in all. Put 3000 down bringing the financed price back down to 12,500. According to the dealership capital one was willing to offer 6.5% with the warranty and 10% without. Probably should have just taken the 10%, but this is day one and the check engine light came on. Hoping its not serious, will know more tomorrow.

^^^The F&I guy lied. No polite way to put it. It is not legal for the lender to force you to purchase a warranty in exchange for a certain interest rate. In fact if you look at the contract you signed, you will see that it is in bold (and usually in a box) that a purchase of a warranty is optional and not a requirement for financing. This line has been used in auto finance departments at dealerships for decades and it is completely false. They bank on you not knowing the difference.

 

No lender requires you to purchase an extended warranty except for subprime auto dealers that hold their own notes (and that is a whole different story).

 

You can cancel the warranty. It is very unlikely to be worth anywhere near what you paid for it. The dealership has to credit back the pro-rated costs of the warranty against the principal balance of your loan. They are usually reluctant to do this - so you will have to be strong. Look up auto warranty's and their costs and benefits.

 

 

Message 13 of 18
Anonymous
Not applicable

Re: Can't get financing with 700+ Fico 8.

Thanks for that bit of info, will probably look into canceling that warranty. Also that check engine light was due to an issue with a recalled air intake. Contactaced VW and theyll fix it. Not sure how the dealer missed it though. Light came on pretty quick, this was from a fairly large ford dealership.
Message 14 of 18
Anonymous
Not applicable

Re: Can't get financing with 700+ Fico 8.

As stated above, the finance guy lied.  They pulled this on me in the past and even knowing it was a lie I still went with it because i was in such a bad credit position that I felt like i had to take it or they wouldn't even deal with me.

 

You on the other hand, had multiple approvals and are in a great position.

 

Please cancel the warranty and have them apply the pro-rated amount to principal.

 

Good luck!

Message 15 of 18
TRC_WA
Senior Contributor

Re: Can't get financing with 700+ Fico 8.


@StartingOver10 wrote:

You can cancel the warranty. It is very unlikely to be worth anywhere near what you paid for it. The dealership has to credit back the pro-rated costs of the warranty against the principal balance of your loan. They are usually reluctant to do this - so you will have to be strong. Look up auto warranty's and their costs and benefits.


Definitely gotta be strong...

 

Years back when I bought a car I bought the warranty.  I had second thoughts afterwards and went back to cancel it... it was a complete nightmare.  The finance guy filled out the paperwork and it was signed by both parties... then he never sent it in.

 

12 weeks later when I still hadn't gotten credit I ended up having to go to the GM of the dealership and threaten to take the whole thing to the local TV station... needless to say the $3000+ was credited to my lienholder within 48 hours.

 

 

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Message 16 of 18
StartingOver10
Moderator Emerita

Re: Can't get financing with 700+ Fico 8.

^^^This.

I had to learn the hard way too - years ago. Smiley Sad

 

The warranty's cost much more than they return. There are many exclusions in the warranty contract so read it in its entirety before you commit to keeping it.  Remember, as someone has said, (paraphrased) 'what the big print gives the small print takes away'....

 

 

Message 17 of 18
Ups77
Regular Contributor

Re: Can't get financing with 700+ Fico 8.

I worked at a dealership part time while I was in the military. Your best bet is with them. Don't expect then to give you a tier one. But I think they can get you approved only because of thin file. I have been in finance officers office and they usually say score is earned yet. Ming you that was 12 years ago.

Message 18 of 18
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