topic Re: Auto Loan for my Daugther in Auto Loans

Auto Loan for my Daugther

Red1Blue — Sun, 26 Jul 2020 12:07:35 GMT

Any suggestions who might give best rate for a use card for my daugther. I did not pull the recent reports. Last I know her scores in all 3 are north of 750. She got a good job and savings. Strong credit history. She is looking to buy a used 2010 - Honda CRV for 11,800 from dealer. Dealer is saying they will give financing. My concern is they are going to send it out to so many banks and there will be so many inquiries. We are looking to buy a house in the next 6 months so want to play it safe now. Any suggestions who might offer a better financing rate for her. What Bank or CU she should apply for ? How soon we might be able to get the decision?

Re: Auto Loan for my Daugther

Anonymous — Sun, 26 Jul 2020 12:42:08 GMT

Are you and your daughter buying a house together? If so, she should buy car after the house purchase. I would avoid any credit activity that could lower scores. In regards to the car financing, has she looked at her current bank/CU rates? I tend to start with my local credit union.

Re: Auto Loan for my Daugther

Gmood1 — Sun, 26 Jul 2020 13:03:22 GMT

That vehicle is 10 years old. She'll likely get better financing on a much newer vehicle. The further you go back the higher the rates.

As long as she stays within 3 or 4 years of current models. The rates should be pretty decent. It makes no senses to finance a vehicle that old. She'll pay more for it than a newer model, when you factor in the APR rate.

Also depends on who she finances with.

Try the Capital One prequal. It's a soft pull and doesn't affect the scores.

Re: Auto Loan for my Daugther

Red1Blue — Sun, 26 Jul 2020 13:45:27 GMT

@Anonymous wrote:
Are you and your daughter buying a house together? If so, she should buy car after the house purchase. I would avoid any credit activity that could lower scores. In regards to the car financing, has she looked at her current bank/CU rates? I tend to start with my local credit union.

House will be bought on my daugthers name. Her last car I gave her ( 14 years ago ) was a brand new fully loaded Honda Accord EX-L. Top of the line at that time. It was totalled couple of months ago when she was coming home from DC to NH. She was safe but car is totaled. She does not have a car now and she wants to get some thing. Due to covid not sure when she would go back to DC. She can pay in cash from savings but I am advising her to finance the car and keep the savings for the rainy day especially in today's economy. She got a good job and good credit and good savings. She is a member of NFCU through me and we will try. Also she has excellent relationship with BOA and might try that too. I was curious to see if there are other CUs giving a better offer.

Re: Auto Loan for my Daugther

Red1Blue — Sun, 26 Jul 2020 13:54:22 GMT

@Gmood1 wrote:
That vehicle is 10 years old. She'll likely get better financing on a much newer vehicle. The further you go back the higher the rates.

As long as she stays within 3 or 4 years of current models. The rates should be pretty decent. It makes no senses to finance a vehicle that old. She'll pay more for it than a newer model, when you factor in the APR rate.
Also depends on who she finances with.
Try the Capital One prequal. It's a soft pull and doesn't affect the scores.

We thought about getting a newer model. I normally buy 2-3 years old with low milage. The reason we are going for an older model car is she lives in DC and parks the car on the road side. Her last car couple of times some one hit car and caused damage and ran away. That is why we are hesitant to buy a newer model car. She got good job, good credit and good savings. She will be graduating with MS Degree in December. After that she can stay in DC or move to a place with lower cost of living. Not sure options are wide open. We are going to help her out with mortgage downpayment and help her to buy a nice place to stay. Once she gets her own place with parking she can get another car newer model car. For now we are considering to get a disposable car but that is also very safe and reliable. She has very good credit with CapitalOne and we can try that. Thanks.

Re: Auto Loan for my Daugther

PutThatMoneyOnTheTable — Sun, 26 Jul 2020 14:01:10 GMT

@Red1Blue wrote:
Any suggestions who might give best rate for a use card for my daugther. I did not pull the recent reports. Last I know her scores in all 3 are north of 750. She got a good job and savings. Strong credit history. She is looking to buy a used 2010 - Honda CRV for 11,800 from dealer. Dealer is saying they will give financing. My concern is they are going to send it out to so many banks and there will be so many inquiries. We are looking to buy a house in the next 6 months so want to play it safe now. Any suggestions who might offer a better financing rate for her. What Bank or CU she should apply for ? How soon we might be able to get the decision?

DCU, my mom got a used car loan @2.74% in May. She was being offered upwards of 23% from other institution because she had no credit history. I recently added as an AU on 2 of my cards before financing the car and opened a Discover Secured after financing the car.

We tried Capital one and they had no offer for her. So add DCU to the list.

Re: Auto Loan for my Daugther

Red1Blue — Sun, 26 Jul 2020 14:05:21 GMT

@PutThatMoneyOnTheTable wrote:
DCU, my mom got a used car loan @2.74% in May. She was being offered upwards of 23% from other institution because she had no credit history. I recently added as an AU on 2 of my cards before financing the car and opened a Discover Secured after financing the car.

We tried Capital one and they had no offer for her. So add DCU to the list.

Thanks. Do you think we should let the dealer worry about financing? She already decided which car to buy and which dealer to buy it from. I am not sure if the dealer deals with CapitalOne and others or not. When I looked on the CapitalOne it says participating dealers. I do not know what that means. Dealer said they deal with BOA and DCU and other Banks/CU. I want to avoid too many inquires added to the report since she might be buying a house in the next 6 months. I know FICO deals with all dealer sponsored inquiries as one for the car purchase. Just trying to be cautious.

Re: Auto Loan for my Daugther

KLEXH25 — Sun, 26 Jul 2020 14:32:27 GMT

If she already has a car from a particular dealership in mind, can she request that they only pull once or twice? Get it in writing. Rates will be high for a used vehicle that old, but the dealership might have a better offer, especially with money down.

But if you want to go in with an offer already, I would go with a credit union. Just make sure there are no exclusions for the age/ mileage on that vehicle first. Is she a member of any? Or perhaps she can join through one of yours?

Re: Auto Loan for my Daugther

Red1Blue — Sun, 26 Jul 2020 14:36:22 GMT

@KLEXH25 wrote:
If she already has a car from a particular dealership in mind, can she request that they only pull once or twice? Get it in writing. Rates will be high for a used vehicle that old, but the dealership might have a better offer, especially with money down.

But if you want to go in with an offer already, I would go with a credit union. Just make sure there are no exclusions for the age/ mileage on that vehicle first. Is she a member of any? Or perhaps she can join through one of yours?

She is a member of NFCU through me. She also has good relationship with BOA and CapitalOne. Dealership is saying they can try with DCU. The car being old not sure how much we can haggle with interest rate. She is going to pay it off soon any way. One thing I want make sure is they do not add too many credit inquires and ruin her scores if she needs to apply for mortgage in the next 6 months. I'll talk to dealer on Monday and see what they say.

Re: Auto Loan for my Daugther

KLEXH25 — Sun, 26 Jul 2020 14:45:12 GMT

If she plans to pay off the car soon, I wouldn't worry about shopping around or haggling. Just pull the trigger with one CU to avoid inquiries and be done with it.

However, with that said, how soon will she pay it off? I know you said she has the money in the bank. Is it worth paying interest and a hard inquiry right before a mortgage app, if she'll pay off the vehicle within a few months anyway?

Re: Auto Loan for my Daugther

Red1Blue — Sun, 26 Jul 2020 14:52:39 GMT

@KLEXH25 wrote:
If she plans to pay off the car soon, I wouldn't worry about shopping around or haggling. Just pull the trigger with one CU to avoid inquiries and be done with it.

However, with that said, how soon will she pay it off? I know you said she has the money in the bank. Is it worth paying interest and a hard inquiry right before a mortgage app, if she'll pay off the vehicle within a few months anyway?

She has enough money now to pay cash and buy the car. I am advising her to keep the money in savings for rainy day especially during this pandamic. She will probably will put a 25-30% down payment and pay it off in the next 24 months assuming the covid issue gets resolved. It is better to have cash in hand and peace of mind during these difficult times. I think it is okay to pay little interst for the car for few months. She has very good fico scores. She piggy backed on my credit when she was 16. Once she got a start she is doing excellent with credit on her own for last 10+ years. I have to pull the scores again. Last year they were in high 700s. I think one of the drags on her score is educaitonal loans. She went to med school and did not like it and dropped out. I am going to help her to pay off her student loans.

Re: Auto Loan for my Daugther

Gmood1 — Sun, 26 Jul 2020 15:43:45 GMT

@Red1Blue

So you are basically throwing away $13k or more because of where she lives? Again, that's what insurance is for. It will cover the damages. I'm sorry but I see absolutely no reason to throw away that much money because of the parking.

That money could be used on a better vehicle from the start. And put her further ahead down the road.

JMHO of course, it's hers or your money.

A lot of top tier banks and CUs will not finance a vehicle that old. I'd recommend some CUs. But I'd have to check and see if they finance 10 yr old vehicles.

Re: Auto Loan for my Daugther

KLEXH25 — Sun, 26 Jul 2020 15:30:47 GMT

@Red1Blue wrote:
@KLEXH25 wrote:
If she plans to pay off the car soon, I wouldn't worry about shopping around or haggling. Just pull the trigger with one CU to avoid inquiries and be done with it.

However, with that said, how soon will she pay it off? I know you said she has the money in the bank. Is it worth paying interest and a hard inquiry right before a mortgage app, if she'll pay off the vehicle within a few months anyway?
She has enough money now to pay cash and buy the car. I am advising her to keep the money in savings for rainy day especially during this pandamic. She will probably will put a 25-30% down payment and pay it off in the next 24 months assuming the covid issue gets resolved. It is better to have cash in hand and peace of mind during these difficult times. I think it is okay to pay little interst for the car for few months. She has very good fico scores. She piggy backed on my credit when she was 16. Once she got a start she is doing excellent with credit on her own for last 10+ years. I have to pull the scores again. Last year they were in high 700s. I think one of the drags on her score is educaitonal loans. She went to med school and did not like it and dropped out. I am going to help her to pay off her student loans.

Ok that makes sense. I thought if she'd pay off in only 4-5 months then it's not worth it. So glad she had excellent credit guidance from you! So few people truly understand credit in a way that is helpful for their children. Best of luck and let us know how it goes!

Re: Auto Loan for my Daugther

Brian_Earl_Spilner — Sun, 26 Jul 2020 15:42:33 GMT

Apply with who you want to and put the reports on ice. I told the dealer I didn't want my app shotgunned, but they tried to run it with LFS. Came back and asked if I knew they were frozen and I said of course I do, in case you tried to do what you did. They felt they could get a better rate through LFS so I thawed it on the spot and they ran it with only LFS. They were right, Lexus gave me a better rate than everyone else I went to.

Re: Auto Loan for my Daugther

Red1Blue — Sun, 26 Jul 2020 15:47:27 GMT

@Brian_Earl_Spilner wrote:
Apply with who you want to and put the reports on ice. I told the dealer I didn't want my app shotgunned, but they tried to run it with LFS. Came back and asked if I knew they were frozen and I said of course I do, in case you tried to do what you did. They felt they could get a better rate through LFS so I thawed it on the spot and they ran it with only LFS. They were right, Lexus gave me a better rate than everyone else I went to.

Hi Brian. Thanks for mentioning it to me. I think we should freeze her reports soon. I'll look into it.

Re: Auto Loan for my Daugther

Red1Blue — Sun, 26 Jul 2020 16:22:15 GMT

@Gmood1 wrote:
@Red1Blue
So you are basically throwing away $13k or more because of where she lives? Again, that's what insurance is for. It will cover the damages. I'm sorry but I see absolutely no reason to throw away that much money because of the parking.
That money could be used on a better vehicle from the start. And put her further ahead down the road.
JMHO of course, it's hers or your money.
A lot of top tier banks and CUs will not finance a vehicle that old. I'd recommend some CUs. But I'd have to check and see if they finance 10 yr old vehicles.

I never bought a car that old. Usually I bought a used car 2-3 year with low miles. Yesterday when we were looking for old cars, I fell in love with 2019 Honda CRV-HL. I guess she started trying to buy a car with insurance check she is getting for the totaled car. Then she decided slowly to go up in price pay it off in full with cash. I talked to her into financing the car and leave the cash in savings. I guess we can always sell this car and get the money back or keep it as a second car. It has only 60k miles not bad for 10 year old car. Car is in very good shape. $11,800 for take home. If this car serves her well for next few months we will shift our focus for her house / mortgage hunting. She got too many things on mind. This is last quarter in school to graduate with her MS Degree. She is working full time. Keeping up with Covid safety precautions.

Re: Auto Loan for my Daugther

Harvey26 — Sun, 26 Jul 2020 22:37:14 GMT

@Red1Blue wrote:
@Gmood1 wrote:
@Red1Blue
So you are basically throwing away $13k or more because of where she lives? Again, that's what insurance is for. It will cover the damages. I'm sorry but I see absolutely no reason to throw away that much money because of the parking.
That money could be used on a better vehicle from the start. And put her further ahead down the road.
JMHO of course, it's hers or your money.
A lot of top tier banks and CUs will not finance a vehicle that old. I'd recommend some CUs. But I'd have to check and see if they finance 10 yr old vehicles.
I never bought a car that old. Usually I bought a used car 2-3 year with low miles. Yesterday when we were looking for old cars, I fell in love with 2019 Honda CRV-HL. I guess she started trying to buy a car with insurance check she is getting for the totaled car. Then she decided slowly to go up in price pay it off in full with cash. I talked to her into financing the car and leave the cash in savings. I guess we can always sell this car and get the money back or keep it as a second car. It has only 60k miles not bad for 10 year old car. Car is in very good shape. $11,800 for take home. If this car serves her well for next few months we will shift our focus for her house / mortgage hunting. She got too many things on mind. This is last quarter in school to graduate with her MS Degree. She is working full time. Keeping up with Covid safety precautions.

I would prequalify with navy federal and boa and see who has the best rates.

Re: Auto Loan for my Daugther

Kforce — Tue, 28 Jul 2020 03:28:36 GMT

@Gmood1 wrote:
That vehicle is 10 years old. She'll likely get better financing on a much newer vehicle. The further you go back the higher the rates.

This is how my CU list financing by age for Auto's

Re: Auto Loan for my Daugther

Red1Blue — Tue, 28 Jul 2020 11:24:53 GMT

@Kforce wrote:
@Gmood1 wrote:
That vehicle is 10 years old. She'll likely get better financing on a much newer vehicle. The further you go back the higher the rates.

This is how my CU list financing by age for Auto's

Thanks for the information. What is your credit union name and what are the requirments for membership ?