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Auto loan with very thin credit history

Alteral
New Visitor

Auto loan with very thin credit history

I am thinking about buying a car, but I am new in the United States.

I am here for 9 months and my credit history is 8 months.

I have 3 credit cards from BofA, AmEx and Discover.

My TU FICO score is 709 and EX FICO score is 716.

Thinking about Toyota C-HR XLE right now. It cost about $25k + taxes and registration.

Income - $23k. I can apply joint with my wife, she has the same annual income.

But I didn't get a pre-qualification through Capital One Auto Navigator.

 

Any suggestions? Or should I wait some time? Or maybe anybody had the same situation?

4 REPLIES 4
Brian_Earl_Spilner
Community Leader
Mega Contributor

Re: Auto loan with very thin credit history

When I worked at Chase, the most we would approve for was equivalent to your yearly income. Having a co-signer will help, but it will depend on the DTI ratio. Try out some online calculators and factor the estimated monthly payment into your DTI. If it's above 35%, you need more money down. Also keep in mind that taxes, LIC, docs, and fees will generally add 10% of the car's value to the total.




Message 2 of 5
Alteral
New Visitor

Re: Auto loan with very thin credit history

Thank you for tips. I have $5k down max.
Message 3 of 5
njcobra10tha
Established Contributor

Re: Auto loan with very thin credit history

Income is low - sorry.  You are lookign to buy a car that costs more than your annual income.

Your credit scores are good but I don't want to se eyou bite off more than you can chew in a monthly payment.

 

Round out your credit portfolio with some sort of installment loan like Self Lender that will help your auto scores.

 

I would aso look at a lesser car.  I know the C-HR is a relatively new model but look if you can get a certified pre-owned one.  You might be suprised how much it will save and still give a great warranty sometimes even better than new.

 

Think about what you can spend on a monthly payment (DO NOT TELL THE DEALER THAT).  Run a loan amortization program download a free template for Excel to do this and figure out what you can borrow at what interest rate and see what makes sense.

 

What do you need?  Do you need a car today?  Can it be a lesser car like a Certified Pre-Owned or just maybe even and older but still reliable Honda Civic or Accord.  Consider that and taking out a very small car loan.  Hopefully your income will increase along with scores and rounding out your scores with auto and other installment loans and when that's paid you can get what you really want?

Message 4 of 5
Alteral
New Visitor

Re: Auto loan with very thin credit history

Thank you a lot.

I think I should wait a little bit more time.

 


@njcobra10tha wrote:

Round out your credit portfolio with some sort of installment loan like Self Lender that will help your auto scores.


Do you have any suggestions about loans? Can I take a loan and pay it in a month, for example?

Message 5 of 5
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