10-14-2012 02:44 PM
Hi - am debating getting a used vs new car. Options narrowed to used BMW Z4 or new MINI roadster cooper s. I'm disabled with annual income around $15k. Bills minimal, have about $500/mo for car payment available, and $15k in cash to use, but that's all of my savings (for now) so would rather not Use more than $5k if I don't have to. Yes, I could get cheaper/less sporty cars, but with my life expectancy, I want something fun. (I'm not old and am tired of feeling that way!) I'd rather spend the time I've got left cruising when I can in a convertible that's fun to drive as that's about all I can do anymore.
TU says score is 595. EQ FICO says 534. No EX score right now. Had paid off all debt except student loans in 2005. Disability began causing payment issues in 2008, so 15 negative accounts. All debt discharged in bankruptcy in June 2012. My student loans are going to be discharged (at lender option, not thru bankruptcy) soon. I'll have no debt then. I pay no housing cost, but just utilities. I live in a house owned by family member. Getting errors corrected on EQ as still shows my mortgage reported twice!) as open with delinquencies and closed in BK!
I'll be shopping for cars hopefully Nov/Dec (best to buy rag top!). MINI finance dealer (who had car I voluntarily surrendered in August 2011 leased through BMW finance) said they'd be happy to have me back as client as I'd worked closely with them through disability issues and gave back car rather than have repo knock on credit. They have alternative lenders and options if BMW won't finance me. I doubt I'd get a great rate and think leasing would be only option through BMW as it was before.
Otherwise, I can get the car I want (Z4) for under $25k used easily. Financing would be a question of where?
I know that BMW has an access loan with lower rates, longer repayment terms, and modification programs for disabled. I applied online, but was denied. They require 620 score minimum. Has anyone ever financed through this program? I can't talk to a person, just get told to apply online when I call. Frustrating! I'd like to work with local loan officer, but they said all apps go through same online channel?
any advice? And, assuming my student loans are discharged (about $200k), I'll have no debt. I can prove all I claim to loan officer, but what's the best course to pursue? And how can I get my EQ score higher? Can't believe difference between that and TU!
10-14-2012 04:46 PM - edited 10-14-2012 04:49 PM
Welcome to the forums Jane!
Wish I knew more about methods of handling your individual situation; however, from what you described, I'd be wrapping my arms around the Mini dealership that offered to work with me on financing.
There may be some recourse you have a result of your disability, I just don't know what it is. The recent BK is a killer, but most people can get an auto loan if they bring enough cash to the table. In your case, you're looking probably at 20%, which means you may well be able to be just fine with dealership financing for a used vehicle around 25K, and that's doubly true if you've already talked to them and they're willing to work with you. Only big issue you're looking at is likely a $500-600/month payment, if you can stomach that on a used car, then you'll likely be fine.
I won't ask what your prognosis is, but if you're not looking at longer than call it 6-7 years, while I typically consider leasing to be a poor financial choice, I agree with you: go live as much as you can. Your payment leasing will be smaller than likely any other financing you can obtain, you just have to be willing to lease another car at the three year mark and subsequently six year mark, but from what you suggest is your goal in all this, I'd simply push my bets as far as I could as long as it didn't leave a mess for my family afterwards, and the lease I suspect would be fine for that... you're likely not looking for a long-term asset and so I'd classify it under entertainment anyway.
With regards to improving your score, it really depends what the rest of your credit profile looks like. This particular board isn't that well travelled; however, I would strongly encourage you to post more about your situation in the Rebuilding Your Credit forum including the various positives and negatives of your report, as there is an absolute wealth of information to be had there with regards to repairing one's credit report and score.
10-14-2012 05:13 PM
Thank you! As both cars I'm interested in can be found at the same place, I'm lucky! I'll take your advice and try the finance person at MINI. I have to say they've been so amazing and supportive -- earned my business for life. FYI, I've always leased cars. Payments are lower, they deal with tax issues, and so long as you trade in or buy at lease end, it works out well. I had a Fiero that was always breaking down costing thousands. I have been leasing as opposed to owning ever since for the peace of mind. Plus, driving is a pleasure and I love having a new car every few years. I haven't yet found one that I'd wanted to have longer-term, except my first MINI that got crunched by a deer.
10-15-2012 02:50 PM
I went and looked at a Mini Cooper on Saturday. Nice car.....made an offer of 9k....they were asking 10K....settled on $ 9300. So I apply for financing, and they call me back saying I'm approved at 8% for 36months, with 2K down. I say "I can't put anything down" and he breaks down the numbers saying the sell price is 11K......I say I bought the car for $ 9300....finance guy obviously didn't get together with the salesmen (dealer owner)
I say...."there is your 2K".......LOL
I haven't heard back from him. It' obvious that he sent it into the bank for approval at 11K. The bank said they would only finance 9K.
I shouldn't have to put anything down....right?
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