what kind of lot for this situation?

Anonymous · ‎10-05-2017

I know someone who needs a car. We pulled his credit and his score is a horrible 505. However he has only one account on his CR. It’s a child support account that has a mega amount of late payments. It states his balance is only $1000 and he plans to pay the balance next month. Can he go to a major dealership like Ford, Nissan, etc and they will secure him a loan with a good interest rate, or should he go to a dealership that offers second chance, or is he buy here pay here material? He has a good steady job and lives in a paid-for home inherited from his parents.

Sandman771 · ‎10-05-2017

Many bankers that I spoke to over the years see a Child Support account as a red flag. Thought being if he doesn't pay for his kids a court-ordered amount, then why would I loan him money for a car. There MAY be some sub-prime lenders that would take a shot on him with enough money down, otherwise i'm thinking that he probably would be buy-here pay-here material.

Starting Score: EQ497/TU496/EX 499
Currently: EQ 620 TU 654 EX 627
in the garden since 6/16/2021

StartingOver10 · ‎10-06-2017

Help your friend by having him come to MyFICO to learn about credit. I agree with the above post. It would be better for your friend to put together a plan and then buy a car on payments. A plan might look like the following:

Buy cheap cash car - if he doesn't have all the cash, go to a BHPH and still buy a cheap car he can pay off soon.
Pay his child support on time so no more negative marks are made on his credit report.\
Pull his CR to see exactly what is causing the low score. Verify that the score he is looking at is not a Credit Karma score but a FICO score.
Work on the negative items reporting.
Add positive tradelines so he gets in good paying habits.
Once the FICO score is in the mid-600s, get a reasonably priced vehicle through a regular dealership - but his financing at a CU and not the dealer.

Naturally, he would be in a better place to put together a plan that would work for his individual circumstances.

Anonymous · ‎10-06-2017

Thank you all for responses!! Things turned out the best for him. We went to one of those "we finance anyone" places. They wanted more downpayment than he could handle. We next went to his credit union. This is were the blessing started. He didn't know beforehand the loan officer was his pretty high school classmate. I think the fact that he knew her and was attracted to her made him listen to her. She insisted on not attempting a loan. She instead got him started on a secured personal loan and insisted that he go pay cash for a car. She told him to come back 6 months later and keep the loan in good shape. He agreed. We then went and found a good running car with ice cold air conditioning and a great body. He used his down payment to pay cash!! I then insisted he join myFico and follow the plan StartingOver10 suggested. He agreed. Thanks to all.

StartingOver10 · ‎10-06-2017

@Anonymous wrote:
Thank you all for responses!! Things turned out the best for him. We went to one of those "we finance anyone" places. They wanted more downpayment than he could handle. We next went to his credit union. This is were the blessing started. He didn't know beforehand the loan officer was his pretty high school classmate. I think the fact that he knew her and was attracted to her made him listen to her. She insisted on not attempting a loan. She instead got him started on a secured personal loan and insisted that he go pay cash for a car. She told him to come back 6 months later and keep the loan in good shape. He agreed. We then went and found a good running car with ice cold air conditioning and a great body. He used his down payment to pay cash!! I then insisted he join myFico and follow the plan StartingOver10 suggested. He agreed. Thanks to all.

^^^Wow! That was a great blessing! I'm glad you are such a great friend to give him good guidence and that his high school sweetheart was there at the CU!