Reply
New Member
davidswife
Posts: 6
Registered: ‎01-07-2013

Refi Options & Chances

Hi, I'm new around here, so first just want to say hi. I've been reading around the forum the last couple of days and am amazed at how much info is here and how little I actually knew about credit! I'm hoping to get some advice on refi options after a ch7 bk that included two voluntary repos. DH and I have an '09 Toyota Corolla with 57k miles. We bought it new just before we filed when our credit was at its worst, so our pymt is a whopping $510/mo! ($24,900 @ 16.78% for 72 mos) We currently owe $10,800 and are hoping to refi, but aren't sure if we'll qualify or if it’s smart to do so at this point. We’re scrimping and saving as much as possible right now to cover some big upcoming medical costs. In addition to savings, we’re hoping to refi the car and open a couple more credit cards to cover the costs. 

 

Our scores are in the mid to high 600's, we have a combined household income of $85k, 20k in student loans and $2750 of avail credit (all zero balances). We just purchased a home two months ago and our scores took a bit of a dip after the mtg hit. I’m hoping they’ll rebound after a few months of good reporting. Also, because of the timing of when we bought the Corolla and then protecting it in the bk, it doesn't show up on any of our credit reports, it's like the loan doesn't even exist. So, aside from 20k in student loans, we have no other debt. 

 

My two big questions/concern are 1) Do we have any chance of refinancing and if so, who’d be willing to work with us? A year ago, we tried to purchase another car through Ford and they told us to get lost. Granted, both of the voluntary repos were Fords, so we probably shouldn't have started there... But, we're now under the impression that getting any type of auto loan, refi or new, is impossible. And 2) will the inquiries from applying for a couple additional cards hurt any chances of a refi? 

 

Thanks so much for any advice or input you could give me. I truly appreciate it!

Community Leader
Senior Contributor
StartingOver10
Posts: 3,011
Registered: ‎03-06-2010

Re: Refi Options & Chances

[ Edited ]

When was your BK discharged? It has to have been more than two years because you just closed on a mortgage.

 

JP Morgan Chase is BK friendly. I was able to get a decent rate (7.14% and I'm self employed) with them for a used vehicle 2 yrs out of BK.

You can go to your CU, as long as they weren't included in the BK, and get a loan. FORD is BK unfriendly when you have burned them.

 

You really shouldn't have any issues now given what you posted. Make sure you have proof of your payments on your current vehicle, you may need to supply that since the vehicle you have is showing as IIB.

New Member
davidswife
Posts: 6
Registered: ‎01-07-2013

Re: Refi Options & Chances

Startingover, thanks. Bk was dischared March of '09, so almost 4 years ago. I'll take a look into JP Morgan Chase as well as a CU. It seems like the CU is our best bet at this point. We've never belonged to one, so I'm unfamiliar with how they work and what their advantages are over other banks. I'm also unsure if we should just head down to our local CU or if there are other options.  

Community Leader
Senior Contributor
StartingOver10
Posts: 3,011
Registered: ‎03-06-2010

Re: Refi Options & Chances

You can shop for CU's just like anything else. Try your local CU - around my area they are BK friendly as long as they weren't included in the BK.

 

Some CU's on this board have very high recommendations also.

Valued Contributor
MovingForward_2012
Posts: 3,406
Registered: ‎12-19-2012

Re: Refi Options & Chances

How many inquiries do you currently have from obtaining a new mortgage? I would get approved for the car refi FIRST, then apply for the credit cards.

A voluntary repo is typically called a surrender, and doesn't hurt your credit score as much as a involuntary repo. However, Ford was not the right place to go, I agree on that.

I would try Capital One as well...they have great refi rates and are BK friendly. However, if you were planning on getting a Cap One card, then you will have to wait 45 days for the card if you go for the car refi first and vice versa. They only allow one app every 45 days.
Cards: Orchard Bank ($1100) | Cap1 Cash Rewards ($2500) | Chase Freedom ($1000) | Best Buy ($2500) | Discover It ($1000) | Barclay Rewards ($2500) | Current scores: EX FAKO: 684, CK TU: 649, FICO EQ: 680, FICO TU: 698, FICO EX: 658 Happy Homeowner Since 2/6/13! :smileyhappy: Last App: 4/5/13 Gardening until July 2014
Community Leader
Senior Contributor
StartingOver10
Posts: 3,011
Registered: ‎03-06-2010

Re: Refi Options & Chances


MovingForward_2012 wrote:
How many inquiries do you currently have from obtaining a new mortgage? I would get approved for the car refi FIRST, then apply for the credit cards.

A voluntary repo is typically called a surrender, and doesn't hurt your credit score as much as a involuntary repo. However, Ford was not the right place to go, I agree on that.

I would try Capital One as well...they have great refi rates and are BK friendly. However, if you were planning on getting a Cap One card, then you will have to wait 45 days for the card if you go for the car refi first and vice versa. They only allow one app every 45 days.

Actually, a voluntary repo is just as damaging to your cr score as an involuntary repo. A repo is a repo is a repo. It hits your score hard and your auto enhanced score harder.

You have a better shot with a local CU, especially if its been a while since the repo and you can show you are in a better position financially now. Plus, the CU will only pull your credit once instead of a bunch of times.  

 

New Member
davidswife
Posts: 6
Registered: ‎01-07-2013

Re: Refi Options & Chances

Thanks everyone. I can't seem to figure out how many total, but DH has had 4 inq's since 11/20 and I've had 1 since then. Seems like a lot since we closed on our mtg a month prior to that date on 10/30 and I know we'll have some from then also. Will they be an issue?

 

Our plan is to head down to our local CU with a copy of our credit reports and just lay our situation out on the table. Specifically, we're looking to refi the car AND pull additional credit all in an effort to help infertility costs that DH and I are facing. Hopefully they can help us with one or both. We'll do that before we start applying for any more cards. I actually just got another offer from Cap One and Barclays yesterday, so I'll save them. 

 

As far as the repo, we were told by Ford that a repo is a repo, doesn't matter if you drove it to the lot or they towed it away. I wish our attorney had explained that to us at the time of our Bk, we would've definitely protected them. I feel like we really screwed ourselves by surrending the cars and am really surprised that it was easier getting a mtg after bk than it is a car loan!

Valued Contributor
MovingForward_2012
Posts: 3,406
Registered: ‎12-19-2012

Re: Refi Options & Chances

I disagree on the statement that a voluntary repo is just as damaging to your credit. I surrendered a Honda Accord back in 2003 and on my credit report it shows closed and paid as agreed. YMMV but lenders don't like to spend money repoing cars. If you surrender it at a dealership where they can come just pick it up, it is better. 10 years after the voluntary repo I got approved for tier 1 lease financing through Acura Financial. On my welcome letter it said, "Welcome back to our family". So they remembered me and my account for the Honda Accord that I surrendered and they fully forgave me for it.
Cards: Orchard Bank ($1100) | Cap1 Cash Rewards ($2500) | Chase Freedom ($1000) | Best Buy ($2500) | Discover It ($1000) | Barclay Rewards ($2500) | Current scores: EX FAKO: 684, CK TU: 649, FICO EQ: 680, FICO TU: 698, FICO EX: 658 Happy Homeowner Since 2/6/13! :smileyhappy: Last App: 4/5/13 Gardening until July 2014

myFICO is the consumer division of FICO. Since its introduction 20 years ago, the FICO® Score has become a global standard for measuring credit risk in the banking, mortgage, credit card, auto and retail industries. 90 of the top 100 largest U.S. financial institutions use the FICO Score to make consumer credit decisions.

>> About myFICO
FICO Score - The Score that matters
Click to Verify - This site chose VeriSign SSL for secure e-commerce and confidential communications.
Fair Isaac Corporation is a BBB Accredited Financial Service in San Rafael, CA
FOLLOW US Social Media Facebook Twitter Pinterest Google+