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New Visitor
fratagonia
Posts: 2
Registered: ‎03-09-2013

Is there a wait period before buying another car?

I'm pretty young and just starting out so I have very little experience aside the ones my parents give me regarding credit and auto loans in general. I plan on buying a car this April (2013 Toyota Highlander) and buying another car in November or December (preferrably a BMW). My current FICO score is 660 and I have the funds to finance for both of these vehicles. Here's the issue and where the question comes in. A buddy of mine from work told me that if I buy a car and then buy another car within months of eachother it would drastically affect my credit negatively. Is there any truth to this? Is there a "wait" period before buying another vehicle in regards to credit? Someone please enlighten me because I'm very new to this.

 

Thankyou

New Contributor
acleynes
Posts: 66
Registered: ‎10-30-2011

Re: Is there a wait period before buying another car?

I bought a Lexus in October 2011, a Honda in November 2011, and closed on a house in February 12.  It is possible, but I do not recommend it.

 

Buying the Lexus was quick and simple.  Buying the Honda was an all day spectacle.  The closing date for my house got pushed back twice and I even got my underwriter fired.

 

I was able to get away with it because of my 6 figure income.


Starting Score: TU 749 02/02/2014
Current Score: TU 749 02/02/2014
Goal Score: 850


New Contributor
ds3
Posts: 76
Registered: ‎10-02-2012

Re: Is there a wait period before buying another car?

I bought a new car in October of last year, and bought another in December. Not only did my scores not drop, I got a 2% better rate on the second one for loyalty through VW credit (I bought a Passat first and an Audi second). I was kind of stunned at how easy it was to get two loans that close together. My CU was willing to finance the first one, but they said no to the second, so staying with VW Credit for both cars worked out well for me.

Valued Member
blackie1
Posts: 36
Registered: ‎06-26-2012

Re: Is there a wait period before buying another car?

Possibly your stated myfico score of 805 had something to do with it??

2fst4u
New Contributor
acleynes
Posts: 66
Registered: ‎10-30-2011

Re: Is there a wait period before buying another car?

My FICO score back then according to Lexus was only 650 I think.  I had 8 baddies on my credit report, until recently.  The baddies fell off in December 2012.  I did apply jointly with my wife.  Her score was worst than mine back then though.  She had no derogatory remarks though.  We were approved for the loans, but our interest rate was not spectacular.  It was 5% and 6%.  Still, I was amazed they financed us100% with very little down.  I only put down $4,000 for the Lexus and $1,000 down for the Honda.  These loans were over $40,000 too.


Starting Score: TU 749 02/02/2014
Current Score: TU 749 02/02/2014
Goal Score: 850


New Contributor
acleynes
Posts: 66
Registered: ‎10-30-2011

Re: Is there a wait period before buying another car?

[ Edited ]

fratagonia wrote:

I'm pretty young and just starting out so I have very little experience aside the ones my parents give me regarding credit and auto loans in general. I plan on buying a car this April (2013 Toyota Highlander) and buying another car in November or December (preferrably a BMW). My current FICO score is 660 and I have the funds to finance for both of these vehicles. Here's the issue and where the question comes in. A buddy of mine from work told me that if I buy a car and then buy another car within months of eachother it would drastically affect my credit negatively. Is there any truth to this? Is there a "wait" period before buying another vehicle in regards to credit? Someone please enlighten me because I'm very new to this.

 

Thankyou


Did you factor in cost to insure vehicle in your calculations? 

When I was car shopping for a luxury vehicle, I was stunned to find out that it cost almost twice as much to insure a Mercedes compared to a Lexus in the same class and that BMW was somewhere in between the two.

 

So real world example.  State Farm wanted to Charge me $200/month for a Lexus RX350, pretty much $400 for a Mercedes GLK, and almost $300 for a BMW X3.  (All same model years)

 

 


Starting Score: TU 749 02/02/2014
Current Score: TU 749 02/02/2014
Goal Score: 850


New Visitor
fratagonia
Posts: 2
Registered: ‎03-09-2013

Re: Is there a wait period before buying another car?

Yes I have already factored in those costs. How long do you think it would take for me to get to 700 score? I'm making my payments on time, have three credit cards. 

New Contributor
acleynes
Posts: 66
Registered: ‎10-30-2011

Re: Is there a wait period before buying another car?


fratagonia wrote:

Yes I have already factored in those costs. How long do you think it would take for me to get to 700 score? I'm making my payments on time, have three credit cards. 


That depends on a lot of variables.

If your score is already at 660 and you are already at or below 9% utilization on all your cards, then it will be really tough to make a huge 40 point improvement in the course of 1 to 3 months.

 

If would be different if your score is 660, but your utlization is over 50% or even 75%.  Then there is a lot of room to make an improvement and it is possible to make a 40 point jump in a few months, if not just 1 month.

 

If the first scenarion fits your predicament, then the only thing that can help you is time to increase your average account age, a credit limit increase (soft pull), and possible an installment loan to add to your credit mix (might back fire though and actually lower your score).

 

 


Starting Score: TU 749 02/02/2014
Current Score: TU 749 02/02/2014
Goal Score: 850


New Contributor
acleynes
Posts: 66
Registered: ‎10-30-2011

Re: Is there a wait period before buying another car?

I do not recommend this, but I will put this information out there anyways.

 

I have a coworker who wanted to buy a Subaru BRZ.  He went over to Subaru and tried to buy the BRZ and was preapproved by the dealership.  It was a weekend and the banks where closed.  The finance manager guaranteed my friend that he could get the loan approved by one of their banks at the promised interest rate when business resumes on Monday.

 

My friend is restless and decides to go over to Toyota the next day and tries to see if he could get approved for the Scion FSR just incase.  Toyota was able to approve him for a loan, even on a weekend, because they have their own bank.  So he ended up buying the Scion FSR.  Toyota was not even aware that he had already applied at Subaru because not even 24 hours had passed. 

 

On Monday, Subaru notifies my friend that one of their banks approved him for the Subaru BRZ.  All he needed to do was come in and sign the paperwork.  None of the banks knew he had already just bought a Scion FSR.

 

My friend stuck with the Scion FSR.  But I believe if he wanted to, he could have bought the Subaru BRZ and no one would have been the wiser until it was too late.  I don't think they will repo the vehicle or cancel the loan if they found out he bought 2 cars in one weekend.

 

So I think it is possible, for you to get your Toyota and your BMW, if you buy them both on the same day.  I was never asked to provide my expenses, just my income when I buy cars.  So I am pretty sure, you could buy a second car before the first car shows up on your credit report.

 

You are planning on buying two cars anways, so I don't see the problem. 

 

 


Starting Score: TU 749 02/02/2014
Current Score: TU 749 02/02/2014
Goal Score: 850


Regular Contributor
Mish0817
Posts: 160
Registered: ‎12-02-2012

Re: Is there a wait period before buying another car?

I didnt have to show anything last weekend when I purchased my daughters car. I still have capital ones blank check. It doesn't say anything about not using it if you purchase another vehicle.....


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