I know nothing!!!

[jcstarkey8826]

So, I ve only had 2 auto loans in my life. Both have a spot on payment history, but its with a local bank in rural AR. They do not report to any CRAs, so I have nothing to show for my auto enhanced. Im wanting to get an auto loan that will report to build history, but Ive never ventured out into the auto world, I would just say I want this card, its this much and shake hands... DONE. Now Im wondering if its smart to get a new car.

My current payoff is 10kish, the cars value is 10kish as well. I pay $293/month at 12% payoff in may 2015. I moved from AR to MI, my SUV is a rear wheel drive and not FWD so the winters are insane for me. I am also driving 80 miles per day for work. When you get 18 mpg the gas bill adds up!!!

Im wondering if it would/could be wise of me to seek a more fuel efficient vehicle and get an auto loan that reports so I can add some positive payment history. Again I have no auto loans reporting, so Im sure that makes my auto enhanced pretty crappy, and my regular FICO isnt that great either.

Where should I start? or am I in a pretty decent deal right now?

[HoldingOntoHope]

With no auto loan history on your reports you are going to be seen as a first time buyer. Your auto enhanced FICO will probably be somewhat lower than your regular FICO score. With the info you provided it's kind of difficult for anyone to assess your situation. Questions would be like are you employed or a student? How long at your job and what income level if employed? What type of down payment can you afford since your trade in is a wash? How much car are you looking to get price wise? What is your debt to income like? What negatives are holding down your current FICO scores?

If you are willing to provide some of this info you will get educated guesses of your best options. If you have made up your mind and only want agreement with your decision then I wouldn't answer the questions.

[jcstarkey8826]

Employed 3 years at same company, 48k per year, down payment of 2k if need be 1k preferable. DTI is 2%  the car I would buy is about 20k (CCs paid in full every month and I have two student loan payments totaling around $100 per month) My current negative on my report is a recent judgement 1 1/2 years ago, from a credit card CO 6 years ago. This is paid and I am working on getting removed.

to be honest it is my co-workers suggesting this. I see the pros, but not sure if its right for me. I wanted to get rid of my car payment in 2 years as the vehicle I have now is very reliable and in good condition. To me its just easier to leave it as is, but I want to do the smart thing, so Im just curious.

[HoldingOntoHope]

I don't think you will have a great problem in securing financing. My guess would be the $2K down will be required (10%) to overcome the negative history. And you won't qualify for the best rates offered in most cases but should get a reasonable (under 10% ) rate if you shop around or let a dealer shop around. But if you really can make do with the vehicle you have then the smart financial thing is to keep it and when you pay it off just keep making payments to a savings account in anticipation of your next car. Money in the bank and financial security trumps a new car any day.