My Equifax is showing at 651 (with 50-55%% utilization). It should be updated in the next couple of days to reflect 37% utilization (I am waiting until then to pull my Transunion). I have several paid baddies, including a repossession (from Sept 2005); all of which are paid (most are approximately 6 years old, 1 judgment from 3 years ago and all were paid in early 2010). I have one 30 day late from 2 years ago (an oversight when my mother died). My average age of accounts is 7 years. Also listed on my credit report is almost 200K in student loans (still deferred as I am still in school – they will go on an income contingent repayment once I am done). My annual income is 40K; 27K is from a full-time job that I started 2 months ago, the remaining 13K is from a seasonal part-time job that I have worked for 3 years. I am looking at the new Honda CRV and the Hyundai Tucson (about $25K). My current vehicle is on its last legs and has 100K miles on it (I purchased it in 2005 from a buy here-pay here immediately following the repossession)
Can I get approved?? I do belong to NFCU and plan to apply to them. However, where else should I apply? Any idea on rates?
Starting Score: EQ 434 TU 499 4/29/10
You are going to have a difficult time getting approved without an extremely high interest rate or a co-signer. Some lenders won't accept the prior reposession (which is going to make your auto-enhanced FICO much lower than your standard), and my problem is with your extremely high student loan level considering your income. What field are you in? If I were you, I wouldn't even consider buying a car that expensive when I have more than $200,000 in student loans.
We need your expenses (monthly). Rent, credit card minimums, etc.
Starting Score: 627 EQ, 621 TU - 11/15/08Thank you for your response.
My monthly expenses are $650 for rent (utilities are apprx $100 total) and the minimums on my credit card are less than $150. Once my student loans go into repayment, based on my current AGI, my payments will be about $200/mth. I will finish my doctorate (finance) this spring so they wont go into repayment until 6 mths later (apprx Nov 2012).
With $40,000 a year in income, the following calculations apply:
Rent - $650
Credit Cards - $150
Student Loans - $200
= $1000 in monthly payments before car / $3,333 income (30% DTI)
Add a appx. $500 a month car payment and you will be at $1500/$3333 = 45% which is close to the border of 50% dti most lenders will accept, but I think you will be ok. Your credit history is bad, so rates could be in the 12-15% or higher range without a cosigner, if they will approve. Might require a decent down payment. Check with your CU first... they are more likely to approve.
Is your income going to significantly increase after your doctorate is complete? Based on current IBR standards for student loan repayments, a single person making $40k will pay $296 a month. That increase very quickly as your pay increases... i.e. $60k is $546 a month for a single person. I am concerned that if your income increases any farther than that, you aren't eligible for IBR and would be hit with HUGE payments. $200,000 in student loans is even higher than some of my MD clients graduate with. Just be careful.