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Member
Posts: 19
Registered: ‎04-13-2011
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First time car loan- wondering if I could get accepted

So here is a brief picture of my credit:

 

I have 3 credit cards, all 3 about a year old - 1 AMEX 3000$, 1 BoA VISA 3000$ and a cap1 MC $1500

I've also been an AU on another BoA VISA (my mom's) that has a $6000 limit and has been paid in time, and with low util and a 3 year history.

 

Other than that I have nothing more. I've never had any baddies and my FICOs are as follow: EX 723, EQ 715 and TU 730. AAoA ~2 years

 

Income: $48000/yr (time at job is 1.5 yrs) and my only obbligation is my rent, which is 1450 a month.

The wife is currently working part time, so making like 1000(ish) a month. She's got pretty good scores too, over 700, but has only 1 cc on her name from 3 yrs ago (always paid in time, no baddies) and is an AU on my AMEX card. I was however thinking of maybe applying together, since those extra 1000$ a month might help with debt to income ratio. She might be starting to work full time at the same place in the next few months, but in this economy nothing is certain, so I'm not really counting on it.

 

We are planning on putting down at least $5-6000, and we can comfortably pay around a 500$ a month loan (plus insurance&gas on it). The car we are looking at, is the Lexus ct200h, but it ain't set in stone and we can easily downgrade. The lexus goes for around 30k MSRP, so I would suppose we would need a 28k(ish) loan, plus our 5k down to cover taxes, tags, etc.

 

Do you think a $28k loan is doable with my profile? My hope is to also try and buy it when Lexus is offering some sort of incentive (low APR), so hopefully I would qualify through their financing company.

 

Thanks for your help, and all comments, suggestions, criticisms are more than welcome (be as cruel as you need, I can take it!)

Moderator Emeritus
Posts: 14,739
Registered: ‎12-30-2011
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Re: First time car loan- wondering if I could get accepted

Should be fine.  Lexus FInancial = Toyota FInancial from an underwriting perspective, and I know first hand as well as from the forums that they've been on a spree of approvals lately for people in worse shape than you are.  We're out of the December to Remember (or whatever we are advertising it as, that may have been Honda's slogan), but for various reasons cars and internal financing are still being pushed.

 

Starting Score: EQ 04 561, TU 98 567, EX 98 599 (12/30/11)
Current Score: EQ 04 693, EQ 8 714, TU 8 710, EX 8 724 (05/27/16)
Goal Score: 700 on EQ 04 (01/01/17)


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Super Contributor
Posts: 9,668
Registered: ‎01-28-2010
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Re: First time car loan- wondering if I could get accepted

 

Do you have any installment loan history on your CRs ?   If so, what was/is the amount that you borrowed.

 

Putting 10~20% down would likely be helpful for getting approval as well....

 

 

March2010 FICO® ~ 695 TU, 653 EQ, 697 EX
Member
Posts: 19
Registered: ‎04-13-2011
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Re: First time car loan- wondering if I could get accepted


pizzadude wrote:

 

Do you have any installment loan history on your CRs ?   If so, what was/is the amount that you borrowed.

 

Putting 10~20% down would likely be helpful for getting approval as well....

 

 


No installment loan in my history, just the 3 revolving accounts and the 1 AU account. That is also the reason why I'm leaning towards putting both mine and my wife's name on the loan, so that she would get some installment history too.

 

Valued Contributor
Posts: 2,851
Registered: ‎08-13-2009
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Re: First time car loan- wondering if I could get accepted

codax85 - if something happened and your income stopped, would you still be able to afford a $500-ish loan payment?

 

If you were to loose your job, could you still afford to pay your car loan AND your other bills?

 

Think ahead the next five years - thinking of getting a house?  A home equity line of credit?  Paying for school?   Need an emergency loan?   Think about how that $500-ish car payment will affect your DTI and your ability to get other credit.

 

Just sayin...   there are so many people on this board who have regretted having such a large auto payment becuase it caused financial stress in other situations and in some cases, prevented them from being able to purchase a home.

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Posts: 19
Registered: ‎04-13-2011
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Re: First time car loan- wondering if I could get accepted


IOBA wrote:

codax85 - if something happened and your income stopped, would you still be able to afford a $500-ish loan payment?

 

If you were to loose your job, could you still afford to pay your car loan AND your other bills?

 

Think ahead the next five years - thinking of getting a house?  A home equity line of credit?  Paying for school?   Need an emergency loan?   Think about how that $500-ish car payment will affect your DTI and your ability to get other credit.

 

Just sayin...   there are so many people on this board who have regretted having such a large auto payment becuase it caused financial stress in other situations and in some cases, prevented them from being able to purchase a home.


I have taken all that into consideration. If I hadn't I wouldn't even consider this. I won't get into details, but I know I won't be losing my job in the next 5-6 years, that is for sure (or as sure as I can be of still being around in 5-6 years). The only real variable is the wife's income, which could go either way (and probably won't get lower than what it is now). 

 

I appreciate your concern and suggestions, however my question was just regarding the "could I be approved for this loan", I am aware enough of my finances and even if everybody tells me "you'll be approved 100%", I won't be going tomorrow to get the car, hell no. I can't even buy a freaking $20 cover for my phone without weighing all the options beforehand, let alone buy something big as a car. It's more a case of: what is inside my reach theoretically, and then I'll make the decision, not before having a nice cushion in my savings for emergencies. 

 

Conclusion: thank you for the concerns, but don't worry... I won't be spending money around like crazy Smiley Happy

Super Contributor
Posts: 9,668
Registered: ‎01-28-2010
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Re: First time car loan- wondering if I could get accepted


codax85 wrote:

pizzadude wrote:

 

Do you have any installment loan history on your CRs ?   If so, what was/is the amount that you borrowed.

 

Putting 10~20% down would likely be helpful for getting approval as well....

 

 


No installment loan in my history, just the 3 revolving accounts and the 1 AU account. That is also the reason why I'm leaning towards putting both mine and my wife's name on the loan, so that she would get some installment history too.

 


That is probably a good idea to put both of your names on the loan, having an installment loan reporting will be good for both of your FICO scores, as your mix of credit improves.

 

IMO you should be able to get approved, I would recommend going to a local CU or bank first to get pre~approved through them.  Then let the dealer pull your credit to see if they can get you a better deal.

March2010 FICO® ~ 695 TU, 653 EQ, 697 EX
Member
Posts: 19
Registered: ‎04-13-2011
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Re: First time car loan- wondering if I could get accepted


pizzadude wrote:

codax85 wrote:

pizzadude wrote:

 

Do you have any installment loan history on your CRs ?   If so, what was/is the amount that you borrowed.

 

Putting 10~20% down would likely be helpful for getting approval as well....

 

 


No installment loan in my history, just the 3 revolving accounts and the 1 AU account. That is also the reason why I'm leaning towards putting both mine and my wife's name on the loan, so that she would get some installment history too.

 


That is probably a good idea to put both of your names on the loan, having an installment loan reporting will be good for both of your FICO scores, as your mix of credit improves.

 

IMO you should be able to get approved, I would recommend going to a local CU or bank first to get pre~approved through them.  Then let the dealer pull your credit to see if they can get you a better deal.


 

Yes, that was my plan to be honest. I am a member of PSECU, so I was planning to first apply through them (they have a pretty good 2.99 rate too) and try and get the dealer to beat that.

Thanks for your help! Smiley Happy

Valued Contributor
Posts: 2,851
Registered: ‎08-13-2009
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Re: First time car loan- wondering if I could get accepted

codax85 - I applaud you!  Not everyone thinks things through as carefully as you said you have.  Smiley Happy

 

And congratulations on your job security.

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Member
Posts: 19
Registered: ‎04-13-2011
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Re: First time car loan- wondering if I could get accepted


IOBA wrote:

codax85 - I applaud you!  Not everyone thinks things through as carefully as you said you have.  Smiley Happy

 

And congratulations on your job security.


Thank you! Trying my best around here Smiley Happy. Still young and with plenty to learn though Smiley Tongue And fortunate that my wife has my same philosophy in life, so I think we make the most of our modest means. I am sometimes surprised of people that make much more money than I do, and still rack up debt without really getting anything meaningful out of it.

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