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653 EQ need loan 45 days past 7 discharge

Established Member

653 EQ need loan 45 days past 7 discharge

Hi everyone and thanks in advance for any advice you can give. I just joined myFico and my EQ score is 653 (woo hoo!!!!) even though I was just discharged from my chapter 7BK on 12/19/12. I talked to the finance manager at a Honda dealership last week when I thought my scores were much lower and he said to expect 14.9-21.9 interest rates. I did not have them pull my credit report.

I want to keep payments around $350 or less and I obviously want a decent interest rate. Where should I go to look for a loan? What type of interest rates should I expect? Should I try to get approved from a bank before I go shopping or should I find the car I want and then go through the dealers finance department?

I currently have an auto loan from 7/2011 (wells fargo dealer services) that was discharged in bankruptcy. We tried to reaffirm and never heard back from the bank. They sent a letter last week asking us to surrender and then it started buring oil (mechanic estimates 2k to fix). I owe about 5k more than the trade in, so we aren't going to fight them and surrender the car. I had a few 30 day lates on the car loan before we filed chapter 7.

Message 1 of 10

Re: 653 EQ need loan 45 days past 7 discharge

From what you post it's unlikely your auto-enhanced score is going to be the same as what you got here. It will likely be lower.

I hate to say this but I think you may need to buy an inexpensive car and take whatever financing you can get from the dealer, and it may be 20% or thereabouts.

I would talk to any local credit unions first and see if any could help. Be ready to pull the trigger though because you may need to let a lot of folks pull your credit to get an approval. Ideally you have something, even if it's Roadloans or another subprime lender (I suggest trying LendingTree) before you talk to the dealership.

Car loans are the easiest of all loan products to acquire, but be mindful that the APR won't be pretty this close to your discharge. From my own experience of having a nasty tax lien on my record and my own auto loan shopping, be unfailingly polite and cordial no matter what happens, act like the lenders or dealership are doing you a favor... Because for me, and I would suggest your situation as well, they actually will be.

On the plus side there's no more damage from talking to 100 lenders than 1 if you do it all in a one month period, so bang on lots of doors but don't be surprised if you have to fall back on dealer financing and have to suck up the APR for a while till you get some breathing room and can refinance the loan hopefully.
Starting Score: EQ 5 561, TU 98 567, EX 2 599 (12/30/11)
Current Score: EQ 5 771, TU 4 741, EX 2 776, EQ 8 809, TU 8 774, EX 8 822 (1/1/18)
Goal Score:    EQ 5 771, TU 4 750, EX 2 776, EQ 8 809, TU 8 774, EX 8 822 (01/01/19)

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Message 2 of 10
Valued Contributor

Re: 653 EQ need loan 45 days past 7 discharge

Prestige Financial will finance you with zero down. They don't require a downpayment and they provide loans to those that just recently filed BK. I financed through them after BK. they have no grace period so you will have to put your payment on auto pay. I'm guessing you will get an interest rate between 17%-21% from Prestige and they have a rate reduction program as well where your rate reduces 0.5% every 6 months if you pay on time. Their website is They only work with certain dealers as they only finance used late model vehicles with low mileage so that repairs won't be a reason to not make a payment. They financed a 2 year old used family sedan for me back in 2008 that was very reliable. I was approved through Acura for a lease in Nov last year and Acura paid off Prestige for my trade in. I highly recommend them as they greatly improved my credit.
Cards: Orchard Bank ($1100) | Cap1 Cash Rewards ($2500) | Chase Freedom ($1000) | Best Buy ($2500) | Discover It ($1000) | Barclay Rewards ($2500) | Current scores: EX FAKO: 684, CK TU: 649, FICO EQ: 680, FICO TU: 698, FICO EX: 658 Happy Homeowner Since 2/6/13! Smiley Happy Last App: 4/5/13 Gardening until July 2014
Message 3 of 10
Established Member

Re: 653 EQ need loan 45 days past 7 discharge

Thank you for your replies.

My father mentioned another option. Since the car is only worth $7500 in good condition and the debt is discharged, do you think the bank (wells fargo dealer services) will take a reduced payoff? Since they would only get about $6000 at an auction? We owe about $13000 on the car and I thought we would offer $6500. Or I could take the car to Carmax or another dealership (with it's current issues, burning oil) and get an offer then offer them that?

My father had never heard of anyone doing this but thought it might be an option since they can't go after us for the deficiency since it was discharged in bankruptcy and it might be finacially beneficial to the bank.

Message 4 of 10
Established Member

Re: 653 EQ need loan 45 days past 7 discharge

I forgot to add that I have had 3 previous auto loans that were paid perfectly - there are about 3 or 4 30 days late on the current loan.

Message 5 of 10

Re: 653 EQ need loan 45 days past 7 discharge

aside from boutique lenders at 16% to 22% rates, I don't like your chances of getting approved. The fact that a BK has been discharged doesn't remove it from your CR, and you are heading into what sounds like it will be a voluntary repo. After that happens, there will be no auto financing for quite some time, from pretty much anybody.


Best advice if you just can't rehab the exiting loan (and it sounds like WF isn't interested) is to find an affordable car that you can either buy for cash or finance buy here pay here.

FICO 04 scores: 809 (EQ) 812 (EX) 818 (TU)

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Message 6 of 10
Established Member

Re: 653 EQ need loan 45 days past 7 discharge

But the repo will be after the loan was discharged in bankruptcy, so they can not report that on any credit report or public record. Why/how would that effect me?

Message 7 of 10
Established Member

Re: 653 EQ need loan 45 days past 7 discharge

I just looked at my EQ score more closely and WFDS did not report any 30 day lates. I really hate that I made 5 payments to them after we filed ch7. That's $1875 that could be sitting in my checking account and I feel like I threw it away. 

Message 8 of 10
Established Member

Re: 653 EQ need loan 45 days past 7 discharge

Just got approved through Capital One blank check!

Application Date:02/03/2013
Approved For (up to)*:$21,600.00
Valid Through:03/20/2013
Product Type:Automobile
Loan Term:60
Loan Type:New Dealer Purchase

*Minimum loan amount is $7,500.00

2012 or Newer7.71%$434.98
2011 - 20117.95%$437.45
2010 - 20098.55%$443.68
2008 - 20069.55%$454.17

I plan to take it to the Honda dealership and negotiate a lease! If they won't give me good terms I will buy something for around $15,000.

Message 9 of 10
Valued Member

Re: 653 EQ need loan 45 days past 7 discharge

Congrats.. Ill be trying to go through Capital One next month

EQ 700 Trans 695 Exp 722
Message 10 of 10