Looking for help with car refi situation

Anonymous · ‎03-30-2017

Hi I'm looking for advice as to what to do with regards to my current car situation.

Filed BK 7/5/16, Discharge 10/12/16 - current scores as of today with Credit Check Total ME: ex604, tu608, eq639 - Husband ex600, TU614. EQ616

My current car which we bought after having to surrender our vehicles due to them being VERY under water/lumped in with a personal loan/requiring lots of mechanical repair.. I bought a 2012Toyota Prius V, current KBB on that car is about $15,500 and my loan balance is $18k with an APR 15.9%

I can easily maintain my payments, I am just looking for a better APR. It seems as if all the local CUs in my area have no issues giving me a loan with a BK on my record, but they will only finance up to 80% and I would need to come up with about 5K to pay the difference. I currently don't have that, nor do if I did would I want to hand that over to lower my interest rate to 9% which is what the current lending guidelines are for most CUs in my area.

I was wondering if it would be worth me trying to locate a new vehicle, trading mine in knowing I will have a DBalance, and getting a lesser APR that way.. or keep on making payments on the car till I'm a year out of BK and seeing what options there are at that time? I know people have had good experience with DCU, but I'm not sure what their lending guidelines are, and I don't want to waste hard pulls. I know PenFed will only loan up to 120%, Not sure how NavyFed works (plus they hate me right now, but seem to love my husband).

Any advice on what ya'll think I should do would be appreciated.

Anonymous · ‎03-30-2017

@Anonymous wrote:
Hi I'm looking for advice as to what to do with regards to my current car situation.
Filed BK 7/5/16, Discharge 10/12/16 - current scores as of today with Credit Check Total ME: ex604, tu608, eq639 - Husband ex600, TU614. EQ616

My current car which we bought after having to surrender our vehicles due to them being VERY under water/lumped in with a personal loan/requiring lots of mechanical repair.. I bought a 2012Toyota Prius V, current KBB on that car is about $15,500 and my loan balance is $18k with an APR 15.9%
I can easily maintain my payments, I am just looking for a better APR. It seems as if all the local CUs in my area have no issues giving me a loan with a BK on my record, but they will only finance up to 80% and I would need to come up with about 5K to pay the difference. I currently don't have that, nor do if I did would I want to hand that over to lower my interest rate to 9% which is what the current lending guidelines are for most CUs in my area.

I was wondering if it would be worth me trying to locate a new vehicle, trading mine in knowing I will have a DBalance, and getting a lesser APR that way.. or keep on making payments on the car till I'm a year out of BK and seeing what options there are at that time? I know people have had good experience with DCU, but I'm not sure what their lending guidelines are, and I don't want to waste hard pulls. I know PenFed will only loan up to 120%, Not sure how NavyFed works (plus they hate me right now, but seem to love my husband).

Any advice on what ya'll think I should do would be appreciated.

I think you will have to risk some HPs because you have a few things going on that make it tough to predict how Penfed, DCU or NFCU would respond. The surrender is seen the same as a repo and the BK is very recent so I am not sure what your options are. What I would do is make extra principle payments on the existing loan for a few months to close the gap between the value and payoff. I think you will have to be under 100% LTV to get this done because of the age of your car. One of the many unfortunate parts of having credit issues is having to live with these crappy finance terms until your credit improves.

I am not a big fan of buying a new car to erase negative equity or improve your APR. I suspect you would still have a fairly high APR and you would bring more negative equity forward because of the transaction costs and low trade in value that every dealer offers. You could end up adding another 5k or so in negative equity which would cancel out the benefit of the better rate. I would give it a year, make extra principle payments and then in a year either refinance or buy a new car but do so with some equity or at least no negative equity on the deal.

TXinandout · ‎03-30-2017

With DCU you need to be at least 2 years post discharge and with NFCU 1 year. You might have a shoot with PenFed.

Have you tried Wells Fargo? You can do the application online.

BK Discharged 06/02/2016 SCORES AROUND 475

Current scores:
EXP-667
EQ-654
TU-653

Anonymous · ‎03-30-2017

I used to work at PenFed and they only finance to 120% which I'm a little above so they're not going to do it. We had a furniture store card backed by Wells Fargo in our BK, do you know if they blacklist you if you've caused them a loss like a CU does? I was thinking trying again after a year and just staying in my current position and just building credit with working on higher CL CCS etc might be another option in the mean time.

TXinandout · ‎03-30-2017

@Anonymous wrote:
I used to work at PenFed and they only finance to 120% which I'm a little above so they're not going to do it. We had a furniture store card backed by Wells Fargo in our BK, do you know if they blacklist you if you've caused them a loss like a CU does? I was thinking trying again after a year and just staying in my current position and just building credit with working on higher CL CCS etc might be another option in the mean time.

I included my mortgage in my bk with WF and a month after discharge they financed my car, so I will say go for it.

BK Discharged 06/02/2016 SCORES AROUND 475

Current scores:
EXP-667
EQ-654
TU-653

Anonymous · ‎03-30-2017

Do you remember what CB they pulled for the loan? I think I'll try tomorrow I have nothing better to do and I hate being told no. lol!

Anonymous · ‎03-30-2017

Capital One might be an option also, their Auto Navigator thing will do a SP preapproval so there is no risk. I believe the LTV will be the biggest barrier though.

TXinandout · ‎03-30-2017

@Anonymous wrote:
Do you remember what CB they pulled for the loan? I think I'll try tomorrow I have nothing better to do and I hate being told no. lol!

It was TU.

BK Discharged 06/02/2016 SCORES AROUND 475

Current scores:
EXP-667
EQ-654
TU-653

Anonymous · ‎03-31-2017

I did try cap one prequal, but it gave me a denial. I included them in our BK so I assume it's not been long enough before we're in blacklisted

Anonymous · ‎03-31-2017

Update, So I went to Wells Fargo and did their Chat Now deal before applying - They said since we had an account included in BK it would be an automatic denial. I checked our credit reports to see if the account we had with them was under my name only, or bot names. It was under both.. so no dice.