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Credit Builder vs.Auto Loan

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missgaonmymind
Contributor

Credit Builder vs.Auto Loan

I wanted to ask a question about the best course of action. I'm awaiting my discharge (about 30 more days) and I wanted to find out if getting a credit builder loan at my local CU, will help my chances on getting an auto loan at a decent rate or at the very least a loan. I surrended my car in the BK and need to get one as soon as I get my papers.

Current score post Ch 7 10/28/14 discharge : EQ: 729 TU 737 EX 725
Goal scores: 800

Chase Sapphire Preferred- $14k Capital One Venture- $10k; Capital One Spark Business- $5k; Discover IT: $11k, Discover Chrome- $14.5k; Navy Federal Cash Rewards- $7.1k; Navy Federal Go Rewards- $12.4k; AMEX Gold; AMEX SkyMiles Plat- $5k; Macy’s AMEX- $12k
Message 1 of 6
5 REPLIES 5
missgaonmymind
Contributor

Re: Credit Builder vs.Auto Loan

 
Current score post Ch 7 10/28/14 discharge : EQ: 729 TU 737 EX 725
Goal scores: 800

Chase Sapphire Preferred- $14k Capital One Venture- $10k; Capital One Spark Business- $5k; Discover IT: $11k, Discover Chrome- $14.5k; Navy Federal Cash Rewards- $7.1k; Navy Federal Go Rewards- $12.4k; AMEX Gold; AMEX SkyMiles Plat- $5k; Macy’s AMEX- $12k
Message 2 of 6
0REDSOX7
Valued Contributor

Re: Credit Builder vs.Auto Loan

Depends on the lender. If the dealer uses a scoring model that relies on the Auto Enhanced version, than a secured credit builder loan won't help much.

I was able to get two auto loans five days post discharge with no installment loans on my report. I had some prior auto history on my report which helped.

Biggest piece of advice is to make sure your credit report is as cleaned up as it can be. All accounts reporting IIB and 0 balance.
BK Discharge 2/11/14

Currently in the garden.
Message 3 of 6
missgaonmymind
Contributor

Re: Credit Builder vs.Auto Loan

Thanks a bunch! That definitely helps!
Current score post Ch 7 10/28/14 discharge : EQ: 729 TU 737 EX 725
Goal scores: 800

Chase Sapphire Preferred- $14k Capital One Venture- $10k; Capital One Spark Business- $5k; Discover IT: $11k, Discover Chrome- $14.5k; Navy Federal Cash Rewards- $7.1k; Navy Federal Go Rewards- $12.4k; AMEX Gold; AMEX SkyMiles Plat- $5k; Macy’s AMEX- $12k
Message 4 of 6
Creditwiser
Valued Contributor

Re: Credit Builder vs.Auto Loan

I'm in a similar situation and will be looking for a new auto loan in a few months.  I was disch in July and I applied for a 2k CB loan. I got about a 12 point boost on my score when it began reporting. It should show a positive 5 or 6 month history by the time I app for the auto loan so Im hoping it helped all around. Although my scores were much better than I expected post disch.

NFCU Visa 30k | NFCU Platinum 30k | Cap1 QS 12K | Cap1 QS 11.5K | Barclay MC 9k | Delta Gold Amex 30K | Discover IT 14K | CFNA FS 3200 | CareCredit 20k| Paypal Credit 5k |
Message 5 of 6
Luftty
Established Member

Re: Credit Builder vs.Auto Loan

Hello.

 

when I filled here in Colorado, I started receiving offers to buy a car days after the filling. Although those APR's are probably very high.

 

why not get a beater for just a year while you build up credit score with the credi builder loan for a year? Then ask the same credit union to pre approve you for a car loan, if they do approve you then head over to their preferred car dealer and trade in the beater for a new-er car while at least getting some of the investment on the old car back.

 

my CU told me that I can refinance my car after 6 months post BK if I show good payment history on my car. I didn't surrender my vehicle.

 

good luck!

Message 6 of 6
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