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Best Strategy to take

Valued Member

Best Strategy to take

Hi everyone I have a feq questions and I am hoping I can get some help.  Let me start by saying my credit is 642 EX  638EQ  610 TU I would also assume that after this month they might go up 5 to 10 points a piece.  I have two charge off accounts on my credit that I pay monthly payments to in agreement.   I have two past auto loans that were payed in full over 5 years never missing a payment.  I also work at a fire department and my yearly salary is 52,000.  Basically am I better off to try to get a loan at the dealer through one of there many loan companys??  My bank fifth third said they cant do anything with less than 750 credit score.  Would I atleast be able to probably get a 8 to 10 percent APR and mostly will I EVEN GET APPROVED AT ALL????

Message 1 of 8
Frequent Contributor

Re: Best Strategy to take

Yes, you should be able to get approved. I would check with your local credit union first, they seem to work more with you and have better rates. See what they could come up with. You are probably looking at rates from 8.29% to 14%.

Also, the more cash down you put the better: Better chance of getting approved; Less overal interest you pay; Possible lower APR's by shortening the term.

Wow, 750 or higher for fifth third? What are they smoking? Smiley Very Happy

Message 2 of 8

Re: Best Strategy to take

Depends on the downpayment.  FICO scoes really are most important for interest rates, and after seeing some of the posts here given how, well, all over the map the lending community is now, it's hard to predict what you're going to see rate wise.  Those two paid car loans are nothing but goodness for an Auto-Enhanced pull if they do one.


Anyway, the king of financing a car, is downpayment.  If you have a sufficient downpayment (minimum 10% as a general rule, though some have found less, 20% much much better, and 30% is laughably easy for anyone to get approved).  Everything else is just finding whoever's going to get you the best rate.  


I do agree with at least looking at CU's, but sometimes they're every bit as conservative as the bank you already tried that suggested having a 750 FICO.  Since all the inquiries roll up into one anyway within a 2 week period minimum (some models are longer timeperiods, but the 2 weeks counts for all lenders currently) it behooves you to comparison shop.  Check in the AUto Loans approvals thread for some idea of who's good to approach regarding auto loans currently.  Also lendingtree in my experience doesn't suck.  Once you have your ballpark number as to where you're at, then go down to the dealer and see what they can do.


Don't do any of this though till you're ready to pull the trigger on buying a car.  The inquiry roll-up clock starts ticking the minute you put in the first application; however, if you've already decided what type of car you roughly want, it's really easy to get it all done in a few days max.


Starting Score: EQ 5 561, TU 98 567, EX 2 599 (12/30/11)
Current Score: EQ 5 771, TU 4 741, EX 2 776, EQ 8 809, TU 8 774, EX 8 822 (1/1/18)
Goal Score:    EQ 5 771, TU 4 750, EX 2 776, EQ 8 809, TU 8 774, EX 8 822 (01/01/19)

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Message 3 of 8

Re: Best Strategy to take

Please remember that when a bank decides they have too many loans out on a particular asset class, they change their loan guidelines. So when the Fifth Third bank said you had to have a score of at least 750 in order to get an auto loan, they are really saying they don't want to do anymore auto loans right now (unless the perfect deal comes along).


Banks don't say: Hey - we're not lending money on autos this month.  All they do is change their underwriting criteria. This way they can make it look like the customer doesn't qualify rather than coming out and saying "no more auto loans this month". Same thing happens in the mortgage business. The lender gets in and out of the portfolio by either tightening up criteria or making it more loose or increasing the rate or a combination of both factors.


So shop CU's that are seeking to make vehicle loans.  There are plenty of them out there now.



Message 4 of 8

Re: Best Strategy to take

Wow, you guys love some CU's. I am a member of the largest CU in the country, the NCSECU-North Carolina State Employees Credit Union. Their current auto rate is 5.25% fixed for 60- 72 mo, 4,75% if they payroll deduct. What in the hell is so great about that? If you're in sales like I am, they require 2 yrs of tax returns no matter what your credit score.  I can go to a dealership with a 720 score, get a 3.5% loan for 72 mo from a bank and not show any tax returns.


Message 5 of 8
Regular Contributor

Re: Best Strategy to take

Credit Unions has some good rates, but to be honest my experience matches your. They are most hastle to deal with and normally their online access is limited. I've almost always gotten better rates directly from the dealership with a major back if not with the automaker. I've only done credit union ones and that was with Nasa Federal Credit Union. I sold the car after a year because I was tired of dealing with them. I had to manually mail a check every month because they sucked so bad. This was 2 years ago.

Message 6 of 8

Re: Best Strategy to take

Your post proves my point exactly!



My CU is IBM SEFCU and these are today's rates for a new or used vehicle:


Rates as low as 1.84% APR*24 – 72 months1.84% -13.49%
 73 – 84 months**2.99% – 13.99%
Model Years: 2010 – 2013 as low as 1.84% APR*Up to 84 months1.84% – 14.54%
Model Years: 2009 & Older as low as 2.34% APR*Up to 72 months2.34% – 14.49%



Your CU is not in the market for vehicle loans as evidenced by the rates they are quoting right now.

My CU is in the market for vehicle loans.


Only part of the process has to do with your actual credit score and income. The rest of the process has to a lot to do with the lender from which you are seeking credit!


Message 7 of 8
Moderator Emeritus

Re: Best Strategy to take

Nfcu refinanced my truck and saved me 3.5% interest. I got 4.09 on a used truck refi with a 6 yr old auto judgement showing.

Their new rates are like 1.7

Starting Score: 08/29/2011 TU 671 EQ 674
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Message 8 of 8