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Auto Loan Chances/Advice

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Auto Loan Chances/Advice

I'm considering getting a new vehicle.  My current vehicle was bought new in 2012.  It has almost 110,000 miles on it and it is starting to need a few repairs...hopefully nothing expensive.  But, we do like to have a vehicle with less miles to ensure that it is dependable.  With that being said, here is some background info.  My oldest child got really sick 12 1 /2 years ago and had several years of battelinf life threatening illnesses.  Things added up and I charged quite a bit to all of my credit cards.  At one time, I had probably 10 cards and a personal loan with Bank of America.  Lots of cards with a lot of balances, which made for a difficult time paying them each month. I got behind on just about every CC...30 days, 90 days, 120 days late.  Most were paid charge offs.  So, long story short, I have just one of those CC now (Discover), as the rest were all closed by the creditor.  Personal loan was paid off as well and was in good standing. Last late payment was six years ago.  One account recently came off my credit report and two to three will fall off this month and in August.  There is one medical collections on my file from 2015 that was paid in full.  In 2016, I opened up a MC cc from Credit One, followed by a Visa cc from Credit One and later, I opened a MC from Merrick Bank.  Since that time, our mortgage has been paid in full and my current vehicle is paid for.  That vehicle is in my husband's name. Last big loans that I cosigned for was a Tahoe in 2011 and our mortgage.  Current situation:  I've had no late payments in six years, I pay my cc on time every month, with at least the minimum monthly payments.  I did get a $500 loan thru my local credit union (VACU) through my work. That loan required no credit check, as it is designed to help people on an emergency basis and rebuild their credit.  The payments are taken out of my check biweekly.  My FICO scores are SLOWLY increasing and it is frustrating because they seem to be at a standstill.  My DTI is about 10%.  My cc minimum payments are $55, $61, $81, and $187.  My repayment amount for my loan is $46 a pay check, which is usually $92 a month depending on how the pay period works.  While my DTI is good, my UTI is not so much.  After my recent cc payments post, it should be about 88%...I know...too high!  CO MC $963 balance/$1700 cc limit; CO Visa $1319 balance/$1750 limit (today's payment will bring it to about $983; Merrick MC$2489 balance/$2700 limit; Discover IT $9272 balance/$9500 limit.  My Exp score is 657 and EQ score is 658.  I don't know my Transunion because it looks like to get that, I'll need to pay for it.  It looks like the biggest factors to be credit now is the high utlization.  Thoughts on getting an auto loan?  I've looked (online) at Toyota 4Runner Limited, Ford Explorer ST, Honda Pilot.  With my low DTI, I can make the payments.  I'm fine with waiting on getting a vehicle, as it will give me time to pay down more of my cc and the small loan will be paid in full by next month (I think there is about $142 left on it).  I would prefer not to have a cosigner, just because this will be something I do on my own.  Thoughts?  Anyone know the criteria Ford, Toyota and Honda use to determine loans?  Best one to go with?  I called my local CU and the lady I talked to wasn't super helpful.  I don't want to apply for a loan and be denied and take a hit.  I think my bank, Wells Fargo, is a no go.  I applied for a cc with them about 4 years ago and was denied, even though now they send me pre-qualifications at least once a month.  I know that isn't the same as pre approval, but I do think their credit requirements are pretty tough.  I've seen a lot of posts on here about PENFD and DCU, but it doesn't appear that I qualify to be a member for those CU.

 

Any suggestions are greatly appreciated, even if it is "pay down more debt first".  I have read a lot of forums on here and it seems that approvals are all over the board, which makes it hard to know whether my scores are a definite no for a loan, maybe, or approved.  I keep telling myself, everyday when I'm driving down the road, that all kinds of people get car loans so I'm sure I would get approved, but the rates may be high and not enough for a good car from a reputable dealer.

 

 

9 REPLIES 9
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Re: Auto Loan Chances/Advice

Did you write that on a mobile device?

 

 Anyway, Capital One is one of the more forgiving lenders out there. Go to Auto Navigator (Google it) and apply it's a soft pull of TU and EX.

 

 Once your approved if you don't need income verify, then all you need is your DL and proof of insurance. You can use the navigator to search for cars at dealers up to 500 miles away. Some dealers who use Capital One aren't included in your search, I would recommend CarGurus which is one of the better search engines.

 

 

Message 2 of 10
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Re: Auto Loan Chances/Advice

I did.  Lol.  I figured I could type it on my phone quicker than I could pull out my laptop and start it up.  It didn't quite work as well as I thought it would. 

 

I looked up Capital One Auto Navigator and here are a few questions I have:  1) it says pre-qualify, so it isn't a guaranteed approval  2) I would be limited to certain delearships and 3) I would have to pick a specific car (all of those are correct, right?).  I live in a rural area and the two closest delearships are 10 and 30 minutes away.  Bigger dealerships are at least an hour away.  I've looked at different vehicles online, but have not driven any.  Honestly, when I'm ready to purchase a vehicle, I would love for it to be as smooth as possible and not have to haggle, debate and spend all day at a delearship.

Message 3 of 10
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Re: Auto Loan Chances/Advice


@Lucy_319 wrote:

I'm considering getting a new vehicle.  My current vehicle was bought new in 2012.  It has almost 110,000 miles on it and it is starting to need a few repairs...hopefully nothing expensive.  But, we do like to have a vehicle with less miles to ensure that it is dependable.  With that being said, here is some background info.  My oldest child got really sick 12 1 /2 years ago and had several years of battelinf life threatening illnesses.  Things added up and I charged quite a bit to all of my credit cards.  At one time, I had probably 10 cards and a personal loan with Bank of America.  Lots of cards with a lot of balances, which made for a difficult time paying them each month. I got behind on just about every CC...30 days, 90 days, 120 days late.  Most were paid charge offs.  So, long story short, I have just one of those CC now (Discover), as the rest were all closed by the creditor.  Personal loan was paid off as well and was in good standing. Last late payment was six years ago.  One account recently came off my credit report and two to three will fall off this month and in August.  There is one medical collections on my file from 2015 that was paid in full.  In 2016, I opened up a MC cc from Credit One, followed by a Visa cc from Credit One and later, I opened a MC from Merrick Bank.  Since that time, our mortgage has been paid in full and my current vehicle is paid for.  That vehicle is in my husband's name. Last big loans that I cosigned for was a Tahoe in 2011 and our mortgage.  Current situation:  I've had no late payments in six years, I pay my cc on time every month, with at least the minimum monthly payments.  I did get a $500 loan thru my local credit union (VACU) through my work. That loan required no credit check, as it is designed to help people on an emergency basis and rebuild their credit.  The payments are taken out of my check biweekly.  My FICO scores are SLOWLY increasing and it is frustrating because they seem to be at a standstill.  My DTI is about 10%.  My cc minimum payments are $55, $61, $81, and $187.  My repayment amount for my loan is $46 a pay check, which is usually $92 a month depending on how the pay period works.  While my DTI is good, my UTI is not so much.  After my recent cc payments post, it should be about 88%...I know...too high!  CO MC $963 balance/$1700 cc limit; CO Visa $1319 balance/$1750 limit (today's payment will bring it to about $983; Merrick MC$2489 balance/$2700 limit; Discover IT $9272 balance/$9500 limit.  My Exp score is 657 and EQ score is 658.  I don't know my Transunion because it looks like to get that, I'll need to pay for it.  It looks like the biggest factors to be credit now is the high utlization.  Thoughts on getting an auto loan?  I've looked (online) at Toyota 4Runner Limited, Ford Explorer ST, Honda Pilot.  With my low DTI, I can make the payments.  I'm fine with waiting on getting a vehicle, as it will give me time to pay down more of my cc and the small loan will be paid in full by next month (I think there is about $142 left on it).  I would prefer not to have a cosigner, just because this will be something I do on my own.  Thoughts?  Anyone know the criteria Ford, Toyota and Honda use to determine loans?  Best one to go with?  I called my local CU and the lady I talked to wasn't super helpful.  I don't want to apply for a loan and be denied and take a hit.  I think my bank, Wells Fargo, is a no go.  I applied for a cc with them about 4 years ago and was denied, even though now they send me pre-qualifications at least once a month.  I know that isn't the same as pre approval, but I do think their credit requirements are pretty tough.  I've seen a lot of posts on here about PENFD and DCU, but it doesn't appear that I qualify to be a member for those CU.

 

Any suggestions are greatly appreciated, even if it is "pay down more debt first".  I have read a lot of forums on here and it seems that approvals are all over the board, which makes it hard to know whether my scores are a definite no for a loan, maybe, or approved.  I keep telling myself, everyday when I'm driving down the road, that all kinds of people get car loans so I'm sure I would get approved, but the rates may be high and not enough for a good car from a reputable dealer.

 

 


Is VACU.. Virginia Credit Union if so they have pretty good rates and often give preapprovals with no HP. I would work on getting UTI down alot more and maybe get a credit card with them and do a balance transfer my guess that you would easily have  700 plus credit scores once you get the balances down. Also discover provides your TU score for free.

Message 4 of 10
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Re: Auto Loan Chances/Advice

Yes, it's Virginia Credit Union.  I do have a checking and savings account with them, so I do have a relationship with them even though it is not my main bank.  They do send me flyers for auto loans and their rates are good.  The representative that I spoke to with VACU told me they pull Equifax .  Of course,  that is the only one of the three that shows the small medical bill that went into collections in 2015.  I also agree about paying down the UTI first.  The reason I started looking into vehicles this week is because my check engine Iight came on.  I already know that I will need to replace the bushings and they quoted me a price of $325 to do that. I'm taking my Explorer in today to figure out what caused the check engine light to come on. I'm hoping it will be simple, such as O2 sensor.  But I'm worried that it will end up being something that is pretty expensive.  Granted, it is paid for but I don't want to continuously spend money on it when it would be better in the long run to get something else.  Does it make sense to apply for a VACU cc before or after paying down my cc UTI?  I know adding another card will increase my UTI and there is no guarantee that I could transfer much if the limit isn't high.  I wouldn't want to transfer my whole cc UTI balance to one card.  

Message 5 of 10
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Re: Auto Loan Chances/Advice

I forgot to add, thanks for reminding me about Discover.  I forgot that they said the score they use is from Transunion.  My Transunion score is 659, which is right in line with the other two.

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Re: Auto Loan Chances/Advice


@Lucy_319 wrote:

Yes, it's Virginia Credit Union.  I do have a checking and savings account with them, so I do have a relationship with them even though it is not my main bank.  They do send me flyers for auto loans and their rates are good.  The representative that I spoke to with VACU told me they pull Equifax .  Of course,  that is the only one of the three that shows the small medical bill that went into collections in 2015.  I also agree about paying down the UTI first.  The reason I started looking into vehicles this week is because my check engine Iight came on.  I already know that I will need to replace the bushings and they quoted me a price of $325 to do that. I'm taking my Explorer in today to figure out what caused the check engine light to come on. I'm hoping it will be simple, such as O2 sensor.  But I'm worried that it will end up being something that is pretty expensive.  Granted, it is paid for but I don't want to continuously spend money on it when it would be better in the long run to get something else.  Does it make sense to apply for a VACU cc before or after paying down my cc UTI?  I know adding another card will increase my UTI and there is no guarantee that I could transfer much if the limit isn't high.  I wouldn't want to transfer my whole cc UTI balance to one card.  


I would say pay off two credit ones and then i think you would at least be at 700 then apply for a credit card and bt the merrick bank and some of discover and you can also do an auto loan preapproval. There HP is good for 45 days. 

Message 7 of 10
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Re: Auto Loan Chances/Advice

Update:

 

I knocked down some of my CC balances, but not significantly, unfortunately because something always comes up.  I had to put a down payment on braces for my youngest and then copayments/co-insurance for my oldest.  It's always something.  Then the unfortunate happened...my vehicle messed up over the weekend and found out the rack and pinion will need to be replaced.  I cannot tell you sick I have felt over this because I have been forced to decide whether or not I should repair the issue or get another vehicle.  I'm worried about putting a lot of money into the car and then something else happens to it; however, I don't really want to buy a new vehicle and have a huge payment.  Also, I am very doubtfall that I would be able to get an auto loan for a new car by myself.  

 

I contacted my local CU and talked to them about my options.  I have looked at my credit reports, all three, and have a general idea of what my credit scores are based on my reports and the free scores from my CC.  While they are not all the same, some have been very close to the same range.  After talking with someone at the CU, I felt like the best option was to take out a personal loan for my car repairs and to consolidate some, or all, of my debt.  I applied for $15,650.00 and they counter offered for $13,500.00 stating that my annual income was not sufficient to support the original request.  I'm a little baffled by that because the loan amount they are offering is less than $2,000 of my original request.  In addition, the monthly payments would be the same, give or take, as to what my minimum monthly  payments are to my CC.  I would think an annual income of over $50,000 would be adequate for the request I made; however, I guess I can't really complain since they countered with an amount that will allow me to pay off my two highest credit cards and to repair my car.  

 

My concern is that their letter states my credit score is 648, which is lower than any other report/CC free score has said.  I was very shocked.  Discover says my FICO score is 667 (which is in line with my Equifax score of 669) and Experian has my score as 677.  Wells Fargo, which is where I bank, lists it as 696.  The CU says the reason for that score is the same reason my report and CC FICO score reports give me:  high utilization, proportion of loan balances is too high (only loan I had was the small $500 loan between my employer and my CU, which I just took out in August--this is the second one I took out, but did not require a HP/credit check), serious delinquency and late payments.  I know late payments/derogatory marks can stay on reports for seven years, but shouldn't they have less impact on scores as time passes by?  My first date of delinquency for those accounts was six to seven years ago.  All of those closed accounts were paid in full.  A few have fallen off of my report, with about four to five remaining.  According to Equifax, two or three have an estimated date to drop date of June 2020, so clearly that didn't happen since it is now September, and the rest sometime between early 2021 and 2022.  How many more years is it going to have a huge impact on my scores?  I'm just frustrated because I've read numerous posts on myFICO forum where people have been in similar positions with their credit, but their scores are higher or seem to bounce back quicker.  

 

My goal is to pay off my smaller two credit cards, make extra payments to principle on this loan and put more money in savings.  I am concerned that my lower (than I realized) score and these derogatory marks will still be impacting me next year, which is when I would be more comfortable obtaining an auto loan.  I know my score will take a hit since I applied for the loan, but how much of an impact will paying off the two highest CC balances (one has a balance of $9,060 and the other has a balance of $2,362) have on my score?  Before applying for the loan, my CC total balance was $13,363 and my total credit was $16,650 so my UTI was around 80%.

 

Thoughts?

 

Thoughts?

Message 8 of 10
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Re: Auto Loan Chances/Advice

the one item missing is how much the car repair will be

 

you will take a small hit for a new Inq and new account (loan)

this drop will be hidden by the increase in points by dropping from 80% util to ??%

if it is under 29%, it should be a good amount

 

i think your scores should be just fine by the time you look at picking up a new car next year

dont let the CC's creep up again - that can happen after a consolidation loan pays them off..

 

good luck to you

July 31/2019. EX-712. EQ-704. TU-726
Dec 16/2019. EX. 721. EQ. 723. TU 746
Aug 8/2020 EX. 728 EQ. 714 TU 744
Oct 22/2020 EX. 725 EQ. 716 TU 742
Inq. EX 6 EQ 4 TU 2 - - CC 5x24, 1x12
Amex BCP $20k - Apple GS $17k - BMW/Elan $5k - Cap1 QS $16.7k - Chase Amazon $13.6k - Chase United Club Infinite $20k - Citi DC $14.5k - CreditUnion1 $9k - DiscoverIT $20.5k - HSBC Gold - $10.5k - Wells Sig Visa $12k
Message 9 of 10
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Re: Auto Loan Chances/Advice

Thanks!

Car repairs will be about $2000.  I have that in my savings, but I didn't want to almost completely wipe out my savings and not have a cushion.  I think I would end up back in the same boat I'm in now.   Once the two largest CC get paid off, the balance on the remaining two cards will be $1664.19.  With total credit being $16,650.00 on my credit cards, that utilization will be about 10%.  Add in the two CC balances and the loan amount, my utilization will drop to 49%, which is better than where it is currently sitting.  I should also add that one condition of accepting the CU loan is that some of that will pay off the balance of the $500 loan I have with them.  The new loan will automatically be drafted out of my checking account each month  and there is no penalty for paying it off early. The interest rate was higher, at 12.9%, but it's definitely lower than the CC interest.

 

I have not used my CC in a few months and use my debit card for everything, but it is a fear that the temptation to use them will always be present.  I do automatically transfer money to savings each month and feel like I'll  be able to save more now and make extra payments toward the loan.  I know this isn't really an ideal situation, but I'll be glad to have those balances paid and able to see a reduction in my debt each month.  I have things I want and need to buy in the future, so I plan to be diligent about my spending and saving.

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