We bought a new van from Toyota. My former Chrysler had a serious issue with the brakes and we had been ping-ponging back and forth with corporate. Not worth my family's safety. Bought a Toyota. With credit scores of 604 and 624 we fell in "tier 7" to be financed at 12.5%. Our payment is $674. HIGH!!! (Of course, we made the choice...so please no one be ugly)...with our scores, should we press our luck to have it refinanced like at our local credit union? Toyota runs a deal that in 12 months, we can trade in our van and get tier 4 automatic financing for 2.9% after 12 successful payments. Should we wait our year out or refi? Anyone have a recommendation who to refi with? Anything would be appreciated.
Refi an auto is hard to do with poor credit scores, plus the additional inquiries will damage your score further. May be worth the wait (be sure to save up a good down payment) depending on who they financed you through.
Who did the dealership put you with toyota or another finance company?
I'd find out what bureaus your local CUs pull, and find out what their tiering is. They are very forthright with this information. I would guess that you'd probably want to wait until around 650 for a good refi with a CU, which would put you in the ~7% range. This would put you 6-12 months out to repair your score, depending on many scenarios. If Toyota is willing to work with you at 2.9% after only 12 months, I say wait for that.
Edit: I didn't realize the Toyota deal meant trading in the van after only 12 months. That's totally up to you, but I'd pay careful attention to how much money you roll over into a new loan.
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My CU financed a car for my husband with a TU 643 score at 3.75% with 10% down for 3 years. This payment is also automatically taken out of account at this finance rate. Our CU scores are A+ 720, A 680, B 640, so you would probably fall into c category. They also offer a 1% decrease in interest if you have C credit and take the "Credit where Credits Due Class". According to our CU a C credit would get you a 5.75% interest rate. You may want to check into it. Most CU pull TU and they only pull once, unlike car dealerships. Best Wishes!