Approved for less than expected?

[Anonymous]

Hello,

I'm not sure exactly what my credit score is, but CreditKarma says 757. I assume it's over 700. I make 13k a month, not including bonuses/stock. I have 0 debt and don't pay rent either. I've been driving an old car for a while now and just went to get something nice (2011 Audi R8). The price was 80k. The dealership said, "Max loan amount we can get you approved for is 40k base on your credit let me know if you can put more money down." Why was I only approved for 40k? I have credit cards I can put 50k on.

Also, when buying a used car, is there any way to know ahead of time without knowing the model, how much you can get approved for? I was giong to put down enough to make it 1k a month over 72 months. I figured spending less than 1/13th of my disposable income on a car was within reason, but apparently not.

[Anonymous]

Don't trust the dealer, bring your own financing from your local credit union.

Also each score, each lender brings different terms.

I have recently been declined a credit card with one lender but another gave me their best rate 0% for 6 months then 10%.

Nice car - hope it works out for you.

Also maybe run a tripple report from MyFICO or another to 1) see what bureau they pulled and make sure there is nothing wrong on it.  Credit Karma at times has been 100 points higher or lower than my FICO score.

[Anonymous]

Thanks. So credit unions are a better way to go than banks? I have a long history with Chase bank. 

[Anonymous]

My local credit union just offered me 3.74 for 6 years.

What are the rates at Chase?

I just find that both DCU and my local credit union Visions Federal Credit Union are easier to get approved for better terms.

I also know what they pull DCU pulls Equifax mortgage score and Visions pulls Experian FICO 8.

I just looked on Chase.com and the rate for 72 months is 4.39% vs my 3.74%

Also never forget dealers typically make something when they get you financed so going direct to the lender can save $.  If you are approved at 3.9% dealer may charge you 4.9%

[Anonymous]

I haven't checked the rates with Chase yet. I figured if the dealership could do the financing I would just try that and see what they came back with first. We actually had a Credit Union at work today trying to sign people up for bank accounts. I'm setting up an appointment to check with them. 

[Anonymous]

I agree that getting your own financing is the best option and you may very well find a credit union or other lender that will loan you much closer to the sale price of the vehicle. To answer your question, the reason they likely approved you for a much lower amount is that you are trying to finance a car that is $80,000 and is 8 years old. If you were to default on the loan and they have to take the car back and sell it that is not going to be an easy vehicle to move quickly and they will likely lose a decent chunk of money. If you tried to finance a new car for $80k you'd probably have a much easier time. I'm also guessing that based on your comment that you have been driving an old car for a while and also that you have zero debt you probably don't have a lenghty credit history and may not have financed a vehicle before. These are all things that will hurt you a bit when trying to get financing

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[Indianaguy]

Yeah your best bet is to goto the credit union in person and talk to a loan officer . Also some of the credit unions and banks may not go 72m on the 2011 , they may go 65 m but you never know hopefully they will do the 72m, you can call chase yourself and ask what rate they will give you based on your experian score and they will also let you know if they will go 72m on a 2011. If the car is newer they will loan out more money .

Goodluck

[Creditplz]

Have you had a auto loan before?.

I had 40k limits but no auto loan before to support a 95k car... had to build my way up by getting a loan for $35k then 50k and then I was able to easily lease a 90k car.


Any previous installments that can show you have experience making $1k + payments?.

[Anonymous]

Yeah, I finally had a chance to talk to the dealership and that's what they said too. I don't have any previous experience with installment loans, just credit cards. I did get approved through Sun Trust (at ~6%) though. But decided not to get the car after all. Going to look for a newer one or maybe just get a new Mercedes that is less money.