rebuilding credit issues to get auto approval - HELP!!

[egypt04]

Hi everyone,

I'm not sure where to post this but since I am currently in the market for a "new to me" car I thought I'd try this board first : )

I've had my current vehicle for over 11 years now and I'm looking to trade up while this one is still working. I am looking at a used Hyundai elantra gt or accent hatchback. I am hoping to get $1500 for my current car (02 malibu) and saving $1500-2000 extra to put down as well.

I have never had a car in my name (my mom had to help with this last one). 

Currently my scores are hovering around the 600 range, due to student loan woes. I am currently rehabbing them, 5 will be posting positively by this October and a different one will be good by January. 

I do have 5 current student loans reporting positively. However, there are 2 accounts that have been closed by the creditor (Bank of America) and 5 accounts showing negatively from Wells Fargo (they're offering me settlement terms but I still can't afford to deal with them yet)

: (

I have only 1 credit card (Cap1) but it is almost maxed out. I'm trying to get that paid down but it's a slow process.

I am wondering what I can do from now until early next year to increase my chances of getting an auto loan?

Should I try to get another credit card and do a balance transfer to help out with my utilization amount??

I joined a credit union a few months ago and started a separate car savings acct there as well. I am looking to find a vehicle no more than $12k, which with my large down payment (including trade-in) would be around $3000/$3500. 

I'd be needing to finance somewhere around 9k. I'm looking at a 60 month term. No clue what interest rate I'd get approved for but if I do and it's high I know I can refinance thanks to this board.

Please let me know what you guys would do if you were in my situation.

I'm hoping in just 4-6 weeks my scores will go up another 30-40 points from the student loan rehab finishing up.

Also, I have had a FT job since Feb where I make approx 30k/year.

[Anonymous]

Resolving those student loan issues should help some.

Getting that credit card paid down is critical.  Opening another one is probably a decent idea, but not to just trade off the balance.  You need to figure out how to make a chunk of it go away (pay it off).  For optimal FICO scoring on revolving accounts, you should have three reporting - two with no balance at all, and one at less than 10%.  Next step down (second-best scoring situation) is under 30% across the board - that means, any and all accounts reporting at less than 30% each, not having one maxed out and one zero.  

Do you have any auto loan history?  Your mom helped you with the last car purchase - does that loan report on your credit, or just on mom's?  Is it a 100% clean payment history?  The history and details of any past auto loans affect your auto-enhanced FICO score, as does the absence of any prior auto loan in yoru file.  If you've had a perfect history with your prior loan and it's reporting on your file, you may actually find that your auto FICO is higher than your regular (FICO 8) one.

If your scores rise to the 640-660 range, or if your auto scores are already there, you might be able to get into a loan for single-digit interest (7-10%).  More likely, you'll be in 10-12% territory.  If your scores remain under 620, you're most likelty in 12-15%+ territory.  That's not a good place to  be for 5 years, but if you can continue your rebuilding work and improve your score in the next year above about 660, you'll land firmly in under-5-percent refi range. 

[egypt04]

Nope, I wasn't able to get on that auto loan at all : (

Since I have my one credit card with CAP1 in good standing with a high credit line should I try to get another card with them and transfer a portion of my other cards' balance to that one? That way I'd have 2 open accounts in good standing with less credit utilization overall? I've not been using my card and just trying to pay it down, but it isn't easy. 

Wonderful advice - thanks so much for responding. I will take any and all help I can get! : )

I am wondering if it's better to pay down my credit card with the money I'm saving for a car or not? I hear the more you can put down on a vehicle the better your chances of getting approved are though....

Also, would my credit union be the place to sit down and talk to someone about what to do in order for them to give me an auto loan?