8% interest rate with decent scores. Did we get jacked?

[Phoenix-rising]

Last week DH & I went to the dealership and traded in his truck for an SUV.  He had back surgery in January and with the amount of driving he does for work, he needed something that would be easier on his back.

We were upside down on the truck (which we purchased last November) so we knew the numbers wouldn't be pretty.  They pulled EQ which is the lowest for both of us.  Our FICO scores when we apped were DH-615 and me-736. 

We ended up with a $61k loan with Ford Motor Credit. I figured that since we were upside down on the old truck that would work to our disadvantage, so I didn't bother shopping around on my own.  In hindsight I wish we had waited to see if we could have gotten a better rate. 

I'm sitting here with a bunch of "what if's" right now.

Is it worth it to try to check on financing now before the new loan hits just to see if I could have gotten any takers at a better rate?  Is there any way I can call the other lenders and find out what they offered, if they even approved?  I can see inquiries to Chase Automotive and Cap One.  We didn't ask and the dealer didn't tell us what they may have offered.

I just feel like an idiot that got taken for a ride and would feel better knowing whether 8% was or wasn't the best we could do, instead of wondering "what if".

[cobra19]

Try a CU

[Phoenix-rising]

OK, I just called the local credit untion that's affiliated with the company I work for.  Their rates are 6.65% for 72 months, 6.25% for 60 months, and go lower as you decline in the # years.

The lady I spoke with said that you have to be a member for 3 months before you are eligible for an auto loan.  She also said that any loan over $40,000 has to be board approved.

I've never used a credit union before.  How does that work?  Are you more or less guaranteed to get a loan even if you're a fairly new member?

[Anonymous]

---

Phoenix-rising wrote:

OK, I just called the local credit untion that's affiliated with the company I work for.  Their rates are 6.65% for 72 months, 6.25% for 60 months, and go lower as you decline in the # years.

The lady I spoke with said that you have to be a member for 3 months before you are eligible for an auto loan.  She also said that any loan over $40,000 has to be board approved.

I've never used a credit union before.  How does that work?  Are you more or less guaranteed to get a loan even if you're a fairly new member?

---

No. You still have to qualify and be approved.

[Anonymous]

Also, your local bank or CU may be hesitant about any negative equity.  they prefer to loan only the value of the car in my experience

[Phoenix-rising]

---

mickie08 wrote:

Also, your local bank or CU may be hesitant about any negative equity.  they prefer to loan only the value of the car in my experience

---

That's what I originally thought mickie. 

What I'm thinking about doing is using a couple of BT checks from two CCs I'm not using and try to get the principal down to $40k ASAP.  We bought an '08 Navigator with the Elite package, so if I pay it down to $40k my CC util% will be up, but we won't be upside down. 

Hopefully the credit union (and our FICO scores) won't mind our util % being so high when we go to refinance.

[Anonymous]

a combination of a newer account (the auto loan) and the hig util will probably hurt score quite a bit possible making the lower interest loan alot more expensive.  On top of that, you will be paying high interest on the CC.  Personally, I would just make extra payments on the current loan until you get it paid down enough for a re-fi.

[Anonymous]

My CU also uses EQ (mu lowest score) and translate that to a Beacon Score.  My score was 615 which qualified me for 9.74% APR based on Beacon. When I purchased my Acura Honda Financing uses TU (and EQ) - they offered me 3.9%. If I had stuck with my CU I would have been jacked.  Dealerships work have many financial relationships and may be able to get you a better rate. Conversely, my CU said I would be able to refinance in 6 months if my scores were better. Not sure if I can do that with Honda.

Another option would be to ask if you can refinance later. You could possibly be giving away alot of disposable income. Good luck.

---

Phoenix-rising wrote:

Last week DH & I went to the dealership and traded in his truck for an SUV.  He had back surgery in January and with the amount of driving he does for work, he needed something that would be easier on his back.

We were upside down on the truck (which we purchased last November) so we knew the numbers wouldn't be pretty.  They pulled EQ which is the lowest for both of us.  Our FICO scores when we apped were DH-615 and me-736. 

We ended up with a $61k loan with Ford Motor Credit. I figured that since we were upside down on the old truck that would work to our disadvantage, so I didn't bother shopping around on my own.  In hindsight I wish we had waited to see if we could have gotten a better rate. 

I'm sitting here with a bunch of "what if's" right now.

Is it worth it to try to check on financing now before the new loan hits just to see if I could have gotten any takers at a better rate?  Is there any way I can call the other lenders and find out what they offered, if they even approved?  I can see inquiries to Chase Automotive and Cap One.  We didn't ask and the dealer didn't tell us what they may have offered.

I just feel like an idiot that got taken for a ride and would feel better knowing whether 8% was or wasn't the best we could do, instead of wondering "what if".

---

Message Edited by PurpleHaze on 08-25-2008 09:54 PM

[boosie1979]

Hi,

I just was pre approved with my credit union. My eq score is 609. I was approved for 7.5%. I didn't try anywhere else since my score was so low I thought I would be declined and didn't want to take the pulls.

I haven't been a member long about an year. I would say try the credit union and refi later.

[Phoenix-rising]

---

mickie08 wrote:

a combination of a newer account (the auto loan) and the hig util will probably hurt score quite a bit possible making the lower interest loan alot more expensive.  On top of that, you will be paying high interest on the CC.  Personally, I would just make extra payments on the current loan until you get it paid down enough for a re-fi.

---

mickie, thanks for the great advice. The BT offers I plan to use to pay down the auto loan now are $7,000 on Citi at 0.00% for 12 months and $9,000 on Discover at 0.00% until 8/2009.  My UTI will be ugly for months, but I figure in 6 months we'll be able to put a decent sized dent in the CC debt.  I won't plan to refi until the CC debt is lower.  Both BT offers are better rates than the auto loan.  I already cleared off Discover in prep for the BT and I'll clear off Citi in 2 weeks.  I think I have a Chase BT offer of $3.99% for the life as well.  Either way I go, I'll make sure the rate is better than the auto loan.  I haven't paid more than 4.99% on a CC in 2 years.

I was starting to enjoy watching my scores go up while the UTI went down.  It will be hard to see my scores after pushing the UTI up again, but AFAIK I won't be apping for anything any time soon.  I think I can afford the hit for 6 months.  And if DH gets a nice bonus at work in December, the UTI will come back down in less than 6 months.

Message Edited by Phoenix-rising on 08-26-2008 07:11 AM