Auto Refinance with BK showing - Need Advice

[Yesitsme7]

Hello,

My situation isn't the best but not the worst either. I need some second opinions.

Filed Chap. 7 BK in 2020 and I have been rebuilding my credit ever since. I currently have 5 credit cards (Cap On, NFCU and a few stores). I bought a car in 2022 and was given a 6.9% rate. Not great but I'm also 2 years out of BK. I'm trying to refi and so far I have only been approved by lenders who are offering me a higher rate than I currently have. NFCU was over 10%. Cap One won't let me refi because my currently monthly payment is literally $5.00 more than what they allow for a refi.

My "best" offer was 8.6% with a PenFed.  It's the lowest of the higher rates I was offered but it's giving me the monthly payment I want.

Is the APR increase worth it for the monthly payment I want? Or should I keep looking?

[Traveler101]

Take a look at ussfcu. Pretty great rates. You can talk with them about your bk on file and see what their policy would be. Best of luck.

[hrguy]

Depends on your scores. Most CU's have a tiered system, and with a not too long ago BK and with the Fed Rates, your 6.9 was a typical ok Rate for a recent BK but not subprime and not for A+ credit, but now that's the 760+ rate at a lot of places for A+ credit. 

USSFCU is good, but that rate advertised is for 760+ when I called into underwriting last week and got their tiers. Which, most BK folks don't have so soon after. I spent all last week collecting data from numerous CU's that would give me their tiers. Most are in the range of your current loans even for tier 2, some have their tier 1 higher than 6.9. The ones that are lower than 6.9 require high scores and they are getting fewer as each monthly Fed Rate hike happens. Gone are the days of 670-680 getting the same as someone with 850. 

[CH-7-Mission-Accomplished]

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@Yesitsme7 wrote:

Hello,

My situation isn't the best but not the worst either. I need some second opinions.

Filed Chap. 7 BK in 2020 and I have been rebuilding my credit ever since. I currently have 5 credit cards (Cap On, NFCU and a few stores). I bought a car in 2022 and was given a 6.9% rate. Not great but I'm also 2 years out of BK. I'm trying to refi and so far I have only been approved by lenders who are offering me a higher rate than I currently have. NFCU was over 10%. Cap One won't let me refi because my currently monthly payment is literally $5.00 more than what they allow for a refi.

My "best" offer was 8.6% with a PenFed.  It's the lowest of the higher rates I was offered but it's giving me the monthly payment I want.

Is the APR increase worth it for the monthly payment I want? Or should I keep looking?

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What is your current loan balance and what is your current payment amount?   What is the remaining loan term?   What loan term are you hoping to get?   What is your desired new payment amount?

[i4owner]

Interest rates in general are higher than in 2022 due to the fed rate hikes, so don't take the high rates personally.  Just life. 

[WildestDreams]

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@hrguy wrote:

Depends on your scores. Most CU's have a tiered system, and with a not too long ago BK and with the Fed Rates, your 6.9 was a typical ok Rate for a recent BK but not subprime and not for A+ credit, but now that's the 760+ rate at a lot of places for A+ credit. 

USSFCU is good, but that rate advertised is for 760+ when I called into underwriting last week and got their tiers. Which, most BK folks don't have so soon after. I spent all last week collecting data from numerous CU's that would give me their tiers. Most are in the range of your current loans even for tier 2, some have their tier 1 higher than 6.9. The ones that are lower than 6.9 require high scores and they are getting fewer as each monthly Fed Rate hike happens. Gone are the days of 670-680 getting the same as someone with 850. 

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Can you share the credit unions? 6.9 - 8%  would be a huge win for me... Been doing research on what CUs will lend to people with BK reporting/ how long after but havent found many that will even consider until 2 years post discharge. 

OP - sadly rates have jumped and refinance rates are even higher. Have you tried AutoPay/RefiJet? Dover FCU? 

[FLLGuy]

IMHO 6.9% is not bad consideirng your recent BK.   I think time and seasoning will be your best friend unless you're willing to burn an endless amount of time (HOPING) some other credit union will do you better considering your BK label.   Even though you can run your credit multilple times for car shopping they will all count for one ding but still, it's more inquiries and sometimes those who say are BK friendly can also change their policies.  Especially in today's economical financial tightening. 

[Yesitsme7]

I left it alone and just stuck with the 6.9 I have.

Thank you all.

[SSH0126]

@Yesitsme7 Who did you get the 6.9% interest rate with? I have a BK on my report as well.

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@Yesitsme7 wrote:

I left it alone and just stuck with the 6.9 I have.

Thank you all.

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[Yesitsme7]

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@SSH0126 wrote:

@Yesitsme7 Who did you get the 6.9% interest rate with? I have a BK on my report as well.

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@Yesitsme7 wrote:

I left it alone and just stuck with the 6.9 I have.

Thank you all.

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Sorry for the delay. I haven't been here in awhile. Chase surprisingly.