Auto Loans

[Jattmoney]

Hi, I am trying to get an auto loan for $14,700 + TTL, but was denied for my limited credit history. I told the sales person I am willing to put down $2,000 in order to get approved, but he said that will not help. I spoke with my older brother who does sell cars for a living, and told him all the information regarding my credit score -- my lowest is 630~ and my highest is 690~. I am willing to put down more money towards the loan (upto $3000) but the sales person said it wouldn't affect anything. My brother on the other hand said I should be easily be able to get a loan because he got someone fianced for a $25K within the same credit score and no credit history at 8% interest. I have the money to buy the car, but I want to build credit history. My other choice is going to a local credit union and applying there. However, I don't want too many hard hits on my credit history either.

My income is $3500, and my only expense is my credit card which has a limit of $2500. I rent, but my siblings pay for the rent while I save. I've been working at this current job for six months, and my previous job was for 10 months, and before that I was going to school full time. Would I be able to get a loan? I need a car for work because I drive a lot, and without a car I can't increase my income. Would I be more likely to get approved by my local bank and local credit union? 

[Jattmoney]

I also owe $1000 on my credit card. And the loan that was denied was by VW financial.

[davefromca]

Start making calls to banks and credit unions, tell them your situation. Give them an idea of your fico score and what you can put down. That way that can at least be sure you can be approved before they run your credit. 

[Jattmoney]

Well I applied at a local credit union, and made an appointment to speak with a banker at my local bank. The credit union used my highest FICO score of 692, and I told them I would only finance $14K. They said the value of the car is $14.9K is the KBB value of the car. I told them that I can put more down, but she said I'll have to talk with the loan officer.  So it is a waiting game now. 

[Jattmoney]

My application wasn't finished when I called before they closed, so I will have to wait till tomorrow for a reply from my credit union. Also going to apply at Wells Fargo because they said I was pre-approved for an auto loan a few weeks back. And I also spoke with the sales person that he should try another lender if possible, and he said he will try Capital One and Bank of America. Also, how do I become a member of PenFed? Will my chances of  getting approved be good, or it just depends as well? 

[FrugalRican]

Have you tried looking for a car slightly less expensive than 14.9?

Your brother gave you all of those variables, but that person's financial situation might not be the same as yours. Every situation is "YMMV".

It seems that you either have no or very little income coming in so you're buying a bit "high" as of right now, which is why that dealer probably doesn't want to finance you.

Also, why are you worried about "hits" on your credit? Do you plan on buying a house anytime soon? If not, it's car shopping, you're going to get hit by Inq's regardless. Pile them all up now while you do your car shopping smartly.

[Jattmoney]

 $3500 per month is low income? I have no expenses beside my credit card. 

[Jattmoney]

This sucks. BOA, Chase, Capital One, BECU, and PenFed denied me. 

[laz98]

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Jattmoney wrote:

 $3500 per month is low income? I have no expenses beside my credit card. 

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I agree with you......that doesn't sound like low income, especially if you have almost no expenses!  I think we make less than you do, together!  I guess it depends where you live, though.  Cost of living here is super low.

[FrugalRican]

I skipped over the part where he had $3,500 income per month.

I just read the part where he said he needed a car to make more.

But how much of the $3,500 is left over after monthly expenses?

Because it sounds like if you waited a month, you could sway them a little more with extra downpayment. I'm sure if you presented more than 20%, they would be singing a different tune.