First Car Loan!!

[2ndTimeAround2012]

Hello All!

I just got my 1st car loan and I'm very excited!

2011 Nissan Versa with 44k miles on it for $12k and amount  financed for $15k.

The dealer had originally offered me 8.69% apr but last minute was denied and

transferred to Chase for 11.74%

I really needed a car and this was a great choice.

Currently, my scores are EQ-642 and TU Walmart - 690

I have unpaid old collections from 07-08.

What really is keeping my score down is high utilization.

I'm working hard at bringing my utilization down to 10% - currently 45-50%

Anyways, my question how do I go about refinancing?

Thanks in advance

[jm00ser]

Congrats on the new purchase, a friend of mine has a versa as well, and it has been quite dependable!

You will want to make a few payments while also getting your utility down so you qualify for an even better rate! A lot of members here will recommend refinancing at a Credit Union, as they offer (usually) the best rates, however that collections MAY hinder that. You can always go in person and discuss with a loan officer to see what they can do.

Make some payment, maybe 6-8 months worth, get that UTIL down, and you will definitely qualify for a rate lower than your current. My first car loan was through Chase as well at 11%!

[maiden_girl]

Get your UTL down to 20% or less. Find a way to settle those collections and have them removed from your credit. They are really hurting your chances at getting a decent rate. 11% is pretty good considering you have 2 collections reporting. Maybe after 6 months of payments on your loan, you can consider refinancing. Hopefully you won't be upside down on your loan!

[Dustink]

Pay down the loan. In general, you need equity to refi into a good rate, If you pay $600 per month, in about a year you should be okay for a refi.

[Volpes]

I though collections where bad?

I'm a little concerned about how the 8.69% fell through. Do you know what you qualified for before stepping into the dealership?

Since you financed through the dealership, there may be a chance they held "points of rate". The lenders that the dealer work with will approve your loan with wholesale interest rates; dealers are allowed to mark up those rates by up to 2 or 3 percentage points. This is extra cash for the dealership, so sometimes they will take advantage of car buyers who they think aren't aware of what interest rate they qualifed for. 

Anyone that finances at the dealership, should get pre-approved or simply ask the finance manager to see the "call back" from the bank. They can show you their computer screen.

I have a feeling this happend to me for my first car loan (September 2008), but I will never know..

[CashOnDelivery]

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@Volpes wrote:

I though collections where bad?

I'm a little concerned about how the 8.69% fell through. Do you know what you qualified for before stepping into the dealership?

Since you financed through the dealership, there may be a chance they held "points of rate". The lenders that the dealer work with will approve your loan with wholesale interest rates; dealers are allowed to mark up those rates by up to 2 or 3 percentage points. This is extra cash for the dealership, so sometimes they will take advantage of car buyers who they think aren't aware of what interest rate they qualifed for. 

Anyone that finances at the dealership, should get pre-approved or simply ask the finance manager to see the "call back" from the bank. They can show you their computer screen.

I have a feeling this happend to me for my first car loan (September 2008), but I will never know..

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I think the same thing happend to me. But luckily these forums will help me whenever I get a new car.