Is a loan based on the score or is it score and history?

[ando35]

I mean, I see people getting 6% lloans with a 650 score and some get 10% loans with a 650 score. Is it because their histroy varies yet they have the same score? Or is it because some of them just got a bad deal?

[pizzadude]

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@ando35 wrote:

I mean, I see people getting 6% lloans with a 650 score and some get 10% loans with a 650 score. Is it because their histroy varies yet they have the same score? Or is it because some of them just got a bad deal?

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It could be either, depends on whether people finance thru a bank/CU or dealer.   There is always some negotiation room in interest rates if you let the dealer shop your loan.    Some of it depends on factors like income, or whether it is their first auto loan.     In short, there are many factors that go into the approval process besides your FICO score.

[Walt_K]

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@pizzadude wrote:

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@ando35 wrote:

I mean, I see people getting 6% lloans with a 650 score and some get 10% loans with a 650 score. Is it because their histroy varies yet they have the same score? Or is it because some of them just got a bad deal?

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It could be either, depends on whether people finance thru a bank/CU or dealer.   There is always some negotiation room in interest rates if you let the dealer shop your loan.    Some of it depends on factors like income, or whether it is their first auto loan.     In short, there are many factors that go into the approval process besides your FICO score.

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+1.  Also other factors, age of car, amount of downpayment, etc.

[ando35]

Do you get better rates with a CU? I saw navy fed credit union giving good rates to people with 650 scores.

[pizzadude]

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@ando35 wrote:

Do you get better rates with a CU? I saw navy fed credit union giving good rates to people with 650 scores.

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Yes, many times CU have better rates or promotions that are better than dealer/manufacturer rates.    And especially NFCU, they have great rates....

[bettercreditguy1]

Could be either who has the best. It depends on how aggressive the lending institution is for that type of loan. Product importance to a financial institution does change from time to time. My brick and mortar bank offered almost 9% for a new car loan, while a credit union offered 2.49%. Again, rates are NOT everything.

On a three or four year car loan, the difference is not that much. Sometimes one needs to repay gratitude for favors previously granted, (like a forgiven late fee, etc). Those things are priceless! 

[Anonymous]

I would have to say score and history.  Last Feb I bought a new truck, 38k.  The dealer ran me through 4 potential financing options.  3 rejected me and Ford Financing approved me.  I ran Cap1 on my own and they approved me up to 40k.  I went with Ford for 1.9% APR.  I know I was below 700, but still probably over 650 back then.  Why did Ford give me such a sweet deal?  This is my second new Ford, first was in 2001 and I paid that off, never missing a payment.  Combine good payment history with Ford and stable work history, equals Ford giving me the best option. 

Funny thing is I am not loyal to the Ford brand, but Ford is loyal to me.  Now if only Mercedes could fall in love with me <3