Auto Loans

[ZX10R]

I'll be paying off my collections in a few weeks and am in need of an auto loan. My Jeep is getting up there in milage (paid off) and would like something newer, keeping the Jeep in the garage. 

Currently I have TU/635 and EQ/590... Once I pay off my collections, it might take awhile for them to post to my score(s)... if I had proof of payment, would that help with getting a better rate?

 This year I reached the 6 figure salary range, which has helped me be able to finally take care of financial mistakes I made in my younger years. I am looking into opening up an IRA and should be maxing out my 401k as well. 

I've always been ashamed when looking at cars because I've been declined regardless of my income.

Any advice will be greatly appreciated.

Thanks!

[JM-AM]

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ZX10R wrote:

I'll be paying off my collections in a few weeks and am in need of an auto loan. My Jeep is getting up there in milage (paid off) and would like something newer, keeping the Jeep in the garage. 

Currently I have TU/635 and EQ/590... Once I pay off my collections, it might take awhile for them to post to my score(s)... if I had proof of payment, would that help with getting a better rate?

 This year I reached the 6 figure salary range, which has helped me be able to finally take care of financial mistakes I made in my younger years. I am looking into opening up an IRA and should be maxing out my 401k as well. 

I've always been ashamed when looking at cars because I've been declined regardless of my income.

Any advice will be greatly appreciated.

Thanks!

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Paying off your collections will have no impact on your scores. If you have the money to pay then I would make every attempt to have a PFD.

While you are always being rejected to purchase a car while making a decent salary usually comes back to the fact your credit is weak, your down payment is weak, and your debt is high.

If the collections are listed on your credit report the payment would be reflected in the credit report once posted. Under manual review you may have a chance for approval, and a decent down payment may help the situation.  If you can have the collection company accept a PFD then it would be deleted from your credit report and you have the possibility your scores may increase, once the credit reports are updated.

If your jeep was financed and is now paid off depending on your payment history on the jeep it can also help or hurt your approval process.

Hope things work out for you.....

[ZX10R]

Thank you for your reply.

It's crazy because I've always had a decent income. The things I have in collection are small things that add up to about $2,000; early termination fees from mobile and cable services, utilities from when I relocated out of state. I knew I should have paid them but was obviously irresponsible and it's definitely catching up with me now!

I have never been late on the payments for my Jeep. In fact it isn't the only car loan on my report that I've had. The only negatives are what I said above. I'm sure a lot of it has to do with me never having credit cards. I am actually about to get a secured card so that I can have some sort of revolving credit. 

So... it looks like I'll attempt to do PFD's. I'll report back to let ya'll know how it goes!

Thanks again!

[webhopper]

Since you have perfect payment history with Jeep, I would start there when looking at cars to buy...  They will be able to look at your past Jeep payment history and may be more forgiving of these silly collections...  Collections are horrible for your scores.