Auto loan? Will I be approved?

[Anonymous]

Okay, here's the deal. I have about $1,500 worth of negative equity on a vehicle with an interest rate that's about 30%... It was a buy here/pay here. They've been reporting the payments to the correct agencies so it shows that I've already had a car loan with no baddies on it. But I want to trade that in on a new car, one that's about $16,500, and with rebates I can get them to cover my negative equity, but I need to know if I have a chance of being approved for a car loan. Here's my stats: I'm 21, my credit score is 713 per Equifax on here, and I have student loans, all under $4,000, the current car loan, and a capital one credit card with a $1,000 limit that's always kept under 20% Utilization. I have no baddies on my report. Now for my employment history, I've only been at my current job 4 months and make about $1,560/month before taxes. The only other expense I would have would be insurance, gas, upkeep, as I live with relatives, even though I know things like that don't matter to the loaners, I just thought I'd throw that in there. I really just want to apply for the auto loan but I don't want to risk being denied and have the pulls on my account... Would I have any chance of being approved? I'd go straight to the dealership if I knew for sure I'd be approved. If only it was that easy! Lol. 

[Anonymous]

I would caution that some, or even most, lenders do indeed look at and account for rent of some kind. You may live rent free now but over the life of a loan you probably won't and that will greatly effect your debt to income ratios.

The bigger problem though would most likely be your income. I can't see how you could get a loan for a car that is almost 100% of your income. You make 18 and change pretax ..

Not trying to give you a hard time. You do have a good credit score but that is far from all they look at. I just can't see you being approved.

Just one guys opinion for what it is worth.

[Remember0]

I think your credit score will allow the dealer to push your loan though using some subprime lender like Santander. Now the big question I'm going to have is what APR will you get? Probably more than what you deserve for your score.

The second question I have is do you understand that the payments will be quite a burden? You're looking at a car payment that could be a third of your take home salary if not more. Instead of buying a new car, have you considered refi'ing the buy here pay here vehicle? Is it reliable or do you want to replace it because it's unreliable or something?