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Do Auto lenders care about the amount of available credit?

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Phoenix-rising
Frequent Contributor

Do Auto lenders care about the amount of available credit?

DH & I are shopping for a car and were discussing credit scores with the salesperson.  She advised us that auto lenders don't like to see too much available credit and said it's a good idea to close some CCs if you don't need them.
 
I have about 8 CCs open with about $30k outstandting and around 30% util.  If I closed some CCs my util would jump and would adversely affect my FICO score.
 
I've heard that mortgage lenders look at the amount of available credit, but I've never heard anything about auto lenders taking that into account.
 
Is she just uninformed or does she have a point?
 
 
DH's FICOS: July '08 TU-661 / EQ-593 / EX-656 --> April '09 TU-730 / EQ-705 / EX-685

MY FICOS: July '08 TU-735 / EQ-727 / EX-767 --> April '09 TU-789 / EQ-774 / EX-767
Message 1 of 4
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Anonymous
Not applicable

Re: Do Auto lenders care about the amount of available credit?

I've never heard of such a thing.  Last year, I bought a car with my Utilization at around 25%. I got a an interest rate of 3.9% My Utilization is currently below 3% right now, but I was never asked to close cards, and/or open lines of credit. Seems like that would be more damaging to FICO score in the long run?
 
I don't know if things have changed, but I think the salesperson may not be well informed.....
Message 2 of 4
Anonymous
Not applicable

Re: Do Auto lenders care about the amount of available credit?

I just purchased an Acura last week.  Originally I applied for a preapproved loan via my CU.  The loan was originally denied because of balances on my CC's and my student loans ... my debt to income ratio was too high. After paying my CC balances and showing my student loan was in deferment, my loan was approved.
 
Conversely, when I applied for financing via the dealership (lower APR offered versus CU), my debt to income ratio was never mentioned. Honda also beat the APR my CU was giving by 6%. So it looks like your personal bank may care, but dealerships could care less. Just make your choice wisely.
 
Happy car shopping.


Message Edited by PurpleHaze on 08-24-2008 08:43 PM
Message 3 of 4
Anonymous
Not applicable

Re: Do Auto lenders care about the amount of available credit?

they are not likely to care about utilization (excpet if it is affecting your score which they do care what your score is) 
 
they are likely to care about debt to income ratio though and if you have alot of credit that may be more the issue to them than the util/available credit. 
 
The exception is if it is all new credit.  that scares them as they are afraid you will run out and charge up all the cards.  Even more so if they see mediocre scores and history. 
Message 4 of 4
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