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Rbn
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Registered: ‎11-10-2012
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Thin credit history and auto loans

Hi all. I am new to the Fico forums. Seems like a great place to accrue knowledge in all forms of credit So Im glad to be apart of it Smiley Happy

 

Ok on to my question. Well a few questions.

 

Im trying to get an auto loan. Pretty new to credit with only about 7 months of history (just generated a score a month ago EQ 572) and 2 lines of credit which are credit cards. I applied for a Chase auto loan a few days ago which they denied stating I needed a minimum of two years credit history and two open lines of credit. So my question is, with my meager 7 months of credit, is it even possible to acquire an auto loan without some huge amount of credit history? If not, what amount IS the right amount? And if I can, anyone have any suggestions on potential lenders that cater to thin credit ? (minus BHPH lots ;P)

 

My car is dying pretty quickly so Im running out of options and I don't have the cash to just buy a car outright. I only make 24K a year so my job shouldn't be a problem if I aim for a cheap car.


Starting Score: EQ 655 TU 622
Current Score: EQ 672 TU 650
Goal Score: 700+ ATB


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Re: Thin credit history and auto loans

[ Edited ]

Going out on a limb here, but I think you need to establish one solid year of credit history, save up a good down payment(the more the better), and keep your credit card balances very low between 1-9% of your total credit limits.  Try not to apply for any new credit, that will only decrease your average age of accounts and hurt your Fico score.  I would try Capital1 blank check first to see where you stand.  If you get approved, you can try to get the dealer to beat the rate they qualified you for.  You should also look into becoming a member of a credit union.  They may be able to help you after you establish yourself a little more.


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Rbn
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Re: Thin credit history and auto loans

Thanks for all your advice. How does Capitol one blank check work?

Starting Score: EQ 655 TU 622
Current Score: EQ 672 TU 650
Goal Score: 700+ ATB


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Re: Thin credit history and auto loans


Rbn wrote:

Hi all. I am new to the Fico forums. Seems like a great place to accrue knowledge in all forms of credit So Im glad to be apart of it Smiley Happy

 

Ok on to my question. Well a few questions.

 

Im trying to get an auto loan. Pretty new to credit with only about 7 months of history (just generated a score a month ago EQ 572) and 2 lines of credit which are credit cards. I applied for a Chase auto loan a few days ago which they denied stating I needed a minimum of two years credit history and two open lines of credit. So my question is, with my meager 7 months of credit, is it even possible to acquire an auto loan without some huge amount of credit history? If not, what amount IS the right amount? And if I can, anyone have any suggestions on potential lenders that cater to thin credit ? (minus BHPH lots ;P)

 

My car is dying pretty quickly so Im running out of options and I don't have the cash to just buy a car outright. I only make 24K a year so my job shouldn't be a problem if I aim for a cheap car.


Instead of banks, how about finance companys?

 

You may qualify for, what they call, "second chance" financing.

 

You can go to a dealership (try a large dealership) in your area.  They will run your CR and will try to get you a loan through their partner finance companys that they work with.

 

The result will usually mean that you will have a lot of inquires on your CR, a higher (possibly reall high) Interest Rate, and you may have to put down a little larger down payment than you are prepared to do.  But you will get a car.

 

Then after a few months to 1 yr or so, after you have built a sold history of paying your car loan timely, you can refi your loan with a better bank and get a better rate.

 

 

"second chance" financing helps ppl with little to no credit history, and even ppl who are rebuilding a second or even third or fourth time.

 

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Re: Thin credit history and auto loans


Rbn wrote:
Thanks for all your advice. How does Capitol one blank check work?

Basically,  you apply on-line just like you would any other loan.  If approved, they will give you a $ amount and  a range of % rates you qualify for based upon the age and mileage of the vehicle you purchase.  They send you the check, you take it to the dealer and fill in the amount.  There are some limitations as I understand, and some dealers do not participate in this program.  Best thing is, the dealer will usually try to beat the Cap1 rate to get the financing.  Cap1 will most likely pull all 3 credit bureaus. 


Starting Score: 500's
Current Score: 773 EQ(DCU), 757 TU(Barclay), 788 EX(Credit.com)
Goal Score:760 X 3


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Re: Thin credit history and auto loans

+1

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Re: Thin credit history and auto loans

You can go online searching for credit union first time car buyer option. I guess you see couple CU will finace for your credit.but you have to have minimum 1 year income tax return and making 1k5 for month. Then you good to go with 7.9 or 9.9 ARP. After 6 months ontime payment you should qualifies for top tier rate!

10/2012 Started with 588 EQ Fico score and 20+ CA and CO
1750$ total CL
10/2013 in 700 Club
Personal :Total CL 196K
Business : Total CL 200K
Business LOC : 1M
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Re: Thin credit history and auto loans


Rbn wrote:

Hi all. I am new to the Fico forums. Seems like a great place to accrue knowledge in all forms of credit So Im glad to be apart of it Smiley Happy

 

Ok on to my question. Well a few questions.

 

Im trying to get an auto loan. Pretty new to credit with only about 7 months of history (just generated a score a month ago EQ 572) and 2 lines of credit which are credit cards. I applied for a Chase auto loan a few days ago which they denied stating I needed a minimum of two years credit history and two open lines of credit. So my question is, with my meager 7 months of credit, is it even possible to acquire an auto loan without some huge amount of credit history? If not, what amount IS the right amount? And if I can, anyone have any suggestions on potential lenders that cater to thin credit ? (minus BHPH lots ;P)

 

My car is dying pretty quickly so Im running out of options and I don't have the cash to just buy a car outright. I only make 24K a year so my job shouldn't be a problem if I aim for a cheap car.


With a score of 572, you should definately check your report for inaccuracies, or derogatory information....     there may be a collection account or something similar out there that is impeding your credit score,  unless of course your one credit card is maxed.   If that's the case then pay if off / down.

you can obtain a free copy of all of your credit reports at Annualcreditreport.com.    You can purchase your real FICOs here Smiley Happy

 

Best of Luck to you!


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Re: Thin credit history and auto loans

Yeah webbope is right. After 6 months you got your credit card. Score is fair not bad . Over 610. 

1: you max out your credit card.

2:you got something going on on your credit report!

3:you pulled your credit score from fako company.

* you better spend 19.99 for myfico and pulled your credit report and score again let see what is happening.

10/2012 Started with 588 EQ Fico score and 20+ CA and CO
1750$ total CL
10/2013 in 700 Club
Personal :Total CL 196K
Business : Total CL 200K
Business LOC : 1M
Garden From 10/13/2013
Rbn
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Registered: ‎11-10-2012
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Re: Thin credit history and auto loans

@webhooper, @TrishN - oh god I just read my gaffe. My EQ credit score is actually 672 not 572. I'm sorry I can't believe it took me that long to realize that. Well I actually have been applying to a few places. I went to Carmax and was approved today for a 14995 loan w/ 18% apr. the sales associate recommends that I refi after a few months a lot like what you guys are saying. At this point I am just thankful I was approved for something. Later I am hoping for a 9% apr. thank you all for your advice I really do appreciate it all.

Starting Score: EQ 655 TU 622
Current Score: EQ 672 TU 650
Goal Score: 700+ ATB


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