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Member
Posts: 14
Registered: ‎12-03-2013
0

Looking for a bigger loan

[ Edited ]

So i want to buy a Toyota 4runner limited 2014 I got approved for two loans or pre approved loans, my local CU gave me 2.9% $15,000 at 40mo And Wells Fargo gave me 3.74% $24,750 at 72mo I ask Wells Fargo and my Credit Union to to see if they could come up in the amount they would lend me. But they both came back at the same amount that they did the first time. I make 52000 a year i have no bills as i stay with family this is my first auto loan should i look around or give up i need at least $30,000 plus i have about $15000 that i want to use out of pocket. My Credit Karma score is 750.

EQ FICO: 789
EX FICO: 742
TU FICO: 772
AMEX $25,000, Discover $18,200, Bank Of America$15,000,Citi$15,000 Paypal Extra $7,500, Chase $6,500, Wells Fargo $4,000, CU Card $3,500, CU Line of Credit $3,500
Member
Posts: 14
Registered: ‎12-03-2013
0

Re: Looking for a bigger loan

any thoughts whatsoever??

EQ FICO: 789
EX FICO: 742
TU FICO: 772
AMEX $25,000, Discover $18,200, Bank Of America$15,000,Citi$15,000 Paypal Extra $7,500, Chase $6,500, Wells Fargo $4,000, CU Card $3,500, CU Line of Credit $3,500
Epic Contributor
Posts: 25,866
Registered: ‎10-23-2007
0

Re: Looking for a bigger loan

I would say 90% of the time when buying brand new you should be financing at the dealer through the automaker... Toyota is offering 0% for 60 months on new cars right now!!!

Fico Scores 8: EX 694. TU 689. EQ 658. 05/26/2015
Member
Posts: 14
Registered: ‎12-03-2013
0

Re: Looking for a bigger loan

Well i would like to get myself finance before I go to a dealer. The reason why i want to do this, l'll be making this purchase a trip as well with the money i could save by traveling out of state. Now i'm not sure if apping to Chase,Keybank(still waiting to here back) will hurt my chance at getting approved for the amount i want? I did looking into toyota financial i could apply with them online they would then send my info to the dealer. No sure i should even do that? the back gave me a good rate but just not the amount i want to finance. my goal is to put about 25% down which is 10-15K the price range for the new 4runner is some where around $41,000-$45,000 anyone know what my chance are with Keybank,Chase and toyota financial? I need atleast 30k would like more but 30k is the magic number for me.

EQ FICO: 789
EX FICO: 742
TU FICO: 772
AMEX $25,000, Discover $18,200, Bank Of America$15,000,Citi$15,000 Paypal Extra $7,500, Chase $6,500, Wells Fargo $4,000, CU Card $3,500, CU Line of Credit $3,500
Community Leader
Super Contributor
Posts: 6,878
Registered: ‎03-06-2010
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Re: Looking for a bigger loan


Autoloanwar wrote:

So i want to buy a Toyota 4runner limited 2014 I got approved for two loans or pre approved loans, my local CU gave me 2.9% $15,000 at 40mo And Wells Fargo gave me 3.74% $24,750 at 72mo I ask Wells Fargo and my Credit Union to to see if they could come up in the amount they would lend me. But they both came back at the same amount that they did the first time. I make 52000 a year i have no bills as i stay with family this is my first auto loan should i look around or give up i need at least $30,000 plus i have about $15000 that i want to use out of pocket. My Credit Karma score is 750.


Since this is your very first vehicle loan, you already represent an unknown risk. Also, there is underwriting criteria that the lender uses based on your income and maximum ratios allowed. I don't know what those ratios are, but I read somewhere that 50% of your gross is the max allowed IIRC.  To me, it is interesting that the CU's max is much lower than WF. Did the CU have the same income information?

 

I think you are already maxed out with the $24,750 as that is more than 47% of your GROSS income. You have deductions from your gross for income taxes and other withholdings.  Once you get a vehicle you will need full insurance and at your age (I'm guessing here because you said you live with family) you may get dinged for being under 25 yrs old.  If you are a male under 25 yrs old, your auto insurance could be high and that along with gas and normal maintenance will eat up quite a bit of the remaining amount of your income. The lender's risk rises disportionately once you get to 50% of your income. Asking them to loan you up to 57% of your gross is asking the lender to take a huge risk. I just don't think it's feasible with your current income to get a loan of $30k IMHO.

 

Don't load yourself up with high debt on your very first vehicle loan. At some point in the future, presumably during the lifetime of this loan, you may want to move out and get a place of your own. A high car payment (plus insurance) will prevent that from happening. Have you considered getting the same vehicle but maybe a year older so you get it for much less? You will save thousands of dollars by buying something a year old rather than new. Good luck in your pursuit of your new vehicle.

Established Contributor
Posts: 667
Registered: ‎11-30-2012
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Re: Looking for a bigger loan

[ Edited ]

The 50% or 2/3's of annual income were the guidelines we used to use so people knew how to shop.  This was back in the old days when financial calculators and loan estimators weren't built into everyone's phone.  Hell we used a little book and people called us on our landline phone from their house land line phone.  Then we had a loan calculator on our desk that cost more than $750 and produced a paper tape about 2 feet long to write up the loan.  

 

It was based on the monthly payment not that you were paying off the car in one year with your annual income.  30k for 60mo is $539/month on a gross of 4,333 or 12%.  Mortgage payment of 1K puts him at 35%.  I would do the pre-approval with Toyota with the appropriate inputs and see what happens.

 

I can't disagree with the find a 2 year old one advice though.

 


StartingOver10 wrote:

Autoloanwar wrote:

So i want to buy a Toyota 4runner limited 2014 I got approved for two loans or pre approved loans, my local CU gave me 2.9% $15,000 at 40mo And Wells Fargo gave me 3.74% $24,750 at 72mo I ask Wells Fargo and my Credit Union to to see if they could come up in the amount they would lend me. But they both came back at the same amount that they did the first time. I make 52000 a year i have no bills as i stay with family this is my first auto loan should i look around or give up i need at least $30,000 plus i have about $15000 that i want to use out of pocket. My Credit Karma score is 750.


Since this is your very first vehicle loan, you already represent an unknown risk. Also, there is underwriting criteria that the lender uses based on your income and maximum ratios allowed. I don't know what those ratios are, but I read somewhere that 50% of your gross is the max allowed IIRC.  To me, it is interesting that the CU's max is much lower than WF. Did the CU have the same income information?

 

I think you are already maxed out with the $24,750 as that is more than 47% of your GROSS income. You have deductions from your gross for income taxes and other withholdings.  Once you get a vehicle you will need full insurance and at your age (I'm guessing here because you said you live with family) you may get dinged for being under 25 yrs old.  If you are a male under 25 yrs old, your auto insurance could be high and that along with gas and normal maintenance will eat up quite a bit of the remaining amount of your income. The lender's risk rises disportionately once you get to 50% of your income. Asking them to loan you up to 57% of your gross is asking the lender to take a huge risk. I just don't think it's feasible with your current income to get a loan of $30k IMHO.

 

Don't load yourself up with high debt on your very first vehicle loan. At some point in the future, presumably during the lifetime of this loan, you may want to move out and get a place of your own. A high car payment (plus insurance) will prevent that from happening. Have you considered getting the same vehicle but maybe a year older so you get it for much less? You will save thousands of dollars by buying something a year old rather than new. Good luck in your pursuit of your new vehicle.




Epic Contributor
Posts: 25,866
Registered: ‎10-23-2007
0

Re: Looking for a bigger loan

You have applied for all these other banks I don't know why it would be a bad idea to apply for Toyota and it sent to the dealership.

Fico Scores 8: EX 694. TU 689. EQ 658. 05/26/2015
Member
Posts: 14
Registered: ‎12-03-2013
0

Re: Looking for a bigger loan

Startingover10 I think i did give the lady at the CU the wrong info when i went in the branch she just wrote it down on a paper i think i told her $4100mo, But with Wells Fargo i gave them a copy of my paystub. However i have over $40,000 in my CU saving Acct.  

 

The CU kind of made me mad when they could not even beat my highest credit card limit. But maybe Im just a huge risk to the lender like you said I have insurance its about 80 dollars a mo for full coverage auto insurance.

EQ FICO: 789
EX FICO: 742
TU FICO: 772
AMEX $25,000, Discover $18,200, Bank Of America$15,000,Citi$15,000 Paypal Extra $7,500, Chase $6,500, Wells Fargo $4,000, CU Card $3,500, CU Line of Credit $3,500
Member
Posts: 14
Registered: ‎12-03-2013
0

Re: Looking for a bigger loan

I have question can i use a credit card for buying a car? Because if i could the Wells Fargo Loan could work I would just put the remain part i want to finance on my card apply for 0% rate from another card company, has anyone tried this?

EQ FICO: 789
EX FICO: 742
TU FICO: 772
AMEX $25,000, Discover $18,200, Bank Of America$15,000,Citi$15,000 Paypal Extra $7,500, Chase $6,500, Wells Fargo $4,000, CU Card $3,500, CU Line of Credit $3,500
Epic Contributor
Posts: 25,866
Registered: ‎10-23-2007
0

Re: Looking for a bigger loan


Autoloanwar wrote:

I have question can i use a credit card for buying a car? Because if i could the Wells Fargo Loan could work I would just put the remain part i want to finance on my card apply for 0% rate from another card company, has anyone tried this?


Many dealers "if" they take credit cards at all will cap how much you can put on ($5k) or what not... you would have to call that dealer and ask... but otherwise if the dealer does it no issue... wouldn't be my choice unless you are paying off in a short period under 12 months.

Fico Scores 8: EX 694. TU 689. EQ 658. 05/26/2015
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