1- You do not have good credit, you have a thin credit file with a negative entry. And that negative entry is killing you. You have good credit if you want a $200 Target Card, a Chase Freedom Card or something else.
Due to the fact you have no other great term loan/auto loan/credit card or great credit experience you are being auto declined by the finance company. Yes that small collection is having ramifications on you now. I once had to tell a girl who COULD have gotten into a brand new car, as a first time buyer with a thin file that the $54.00 Collection from Hollywood Video was stopping her, had she paid it she could have had a car. She looked at me and there was some principle on the the issue and she would never pay it..I said OK told her there was nothing else show could do.
@92235 wrote:
So I went into Hyundai to look into getting a new Accent. Everything was ready to go. The price looked good and I was getting a $750 rebate for using their financing. Well the pull my credit. They told me that I have a 699 but because I am a first time buyer that they would not finance me. It was a combination of first time buyer and a 6.5 year old $167 medical collection. Everything else on my credit is fine. 4.5 years of good credit with no lates. It is not an "everything else" issue, you have shown that you do not pay your bills and you are therefore declined. They looked into other banks to see what they can do. They got one and when they gave me the numbers I poped them into my phone and it came to 11.99%. Nope that is not happening. You need to re do the numbers. They said sorry and gave me new numbers that came to 8.5%. I am also putting down $4000 on a $17k car so that should help right? Nope with their finance company they want to finance everything so it won't help me get financed with them. 8.5% seems a little high for a new car loan. No thats a great loan rate for someone with a bad entry on their report. Again you do not qualify for best credit or first time buyer as you have a negative credit line entry. I had been to Suzuki a few days before and they told me that I could get 3.99% with a local credit union. Umm Kinda, they said you "COULD", there is no guarantee that will be the actual rate you get until the deal is done and they make the contract. The people at Hyundai said that I wouldn't be able to get that because I am a first time buyer. Has anyone else had experience with this? I would imagine a car company would want a first time buyer with good credit and money down. You do not have good credit. First time buyers have challenges of their own and are a crapshoot if they can can take on the car obligation. Since you have a collection you are shown as being unreliable in their eyes. its really that simple.They might have a life long buyer who will by 5 or 6 more cars from them in the future.
2- The car company and the dealership are not the ones taking on the risk of the loan. The Dealership wants to sell as many cares as they can, but unless you are paying cash, they can only sell when a bank finances the loan. For a bank/financial institution to extend financing they have to extend/compute risk to the loan, risk that you will not pay it back the car will be repo-ed and they will never see all the monies owed. Your collection record is killing that.
The manufacturer wants to sell as many cars as they can, but again, even they are not financing the transactions themselves, even their dealer finance arms are semi-discrete entities entrusted to make wise and profitable loans. there is no onus on Ford Motor credit to finance everyone or not finance anyone, or to make the most profit, but they are expected to at least make an operating profit to allow more lending.
If you want the car take the 8.99%, or wait until the negative falls off your report.
Now I will say I do not understand how you putting a DP of $4,000 is not getting you a loan. But with no knowledge of you or your deal more then what you say I cannot even hazard a guess.
A credit union, as they trend to be more flexible in lending, may be the way for you to go, but no one in this forum can actually give you a positive, for sure answer.
If I had been able to sell a car to everyone who wanted to buy one I would still be selling cars now, and would have sold 30+ a month. Unfortunately the dealers and the manufacturer need a bank to extend financing. And the decision really is the banks.
ETA: There could also be other factors that helped contribute to yo declines, such as your gross income and DTI, and living situation.
