Can I get approved?

[mamahearts]

I'm wondering if I have a good chance to be approved for a car loan.

AAoA : 8 years
Income :36480
Employment: full time, same employer 14 years 11 months
Credit Karma scores: 544 and 545
Util: one Capital One card currently at 141% but just made a payment to bring it slightly under 100% util. Cap One should be reporting new balance this week.
Student loans: balance $14000
Mortgage:87800 remaining
Down payment: $500
DTI: 28%
Some late payments on cc and mortgage
1 small collection balance : $80

I'm looking at a 2014 Dodge Avenger for $7911. 52000 miles

Or basically in that range. Don't want to go over $10000.

[Anonymous]

I don’t doubt you will get approved , just be wary of what you’re actually getting . Now a days a dealership will finance anyone at 15% + interest .

[Anonymous]

Agree with above, these days almost anyone can get approved, the important thing is you dont allow your self to believe you have to pay more to get approved. Do your research, make sure you're getting excellent deals as your going ti be saddled with aggressive interest rates. Absolutely do not forgo GAP coverage, said interest is going to make positive equity a distant dream. I would avoid the avenger fyi, poor value and poor reliability.

[Cred4All]

OP,

If you're already at 100% utilization and also have an active $80 collection account which has not been paid, I'd say the chances are almost slim-to-none.  As others stated, anything is possible however it would definitely not favor you in the long run nor would it be something that increases your chance of correcting the problems already present.  It would benefit you greatly to pay down the Capital One to 28.9% util and immediately pay that collection account so you can begin a positive climb.  This would allow you a better, more favorable loan chance even just a few months down the line.

[sccredit]

I think you'll be able to get approved but would urge you to reconsider the car choice.  The Chrysler cars from that era had terrible reliability ratings.  You'll be paying 15% interest on a broken down car in a year or 2.

[mamahearts]

Thanks. Looks like Ford Focus, Chevy Cruze and Kias are the most common option in my price range. Are any of those good? I'm looking at Edmunds reviews for advice too.

[Anonymous]

Out of those I probably would shoot for a focus . Good overall car and you should be able to get a good price on it

[Anonymous]

Steer clear of a Ford Focus in that price range, you will likely be looking at a 2012-2015 which are notorious for transmission issues in those years (Ford extended the factory warranty to 7 yr/100k I believe to compensate for the issue).

A Chevy Cruze, or Honda Civic in that range would be a better choice, Kia's and Hyundai's hold their value terribly so coupled with the high interest you will be underwater for most of the loan.

[mamahearts]

Thanks for the great info. I got preapproved by Capital One. New Ford Fiesta at 7.06 APR. Used cars at about 9-13 APR. Does Capital One only approve certain vehicles at participating dealers?

[Anonymous]

They will approve any vehicle at a participating dealer so long as the collateral is approvable (ie: not too old, not too many miles, etc) I wouldn't personally purchase a new Ford Fiesta, I would look for a low mileage late model vehicle. (2016 Cruze, or something of the sort) You will save yourself a bit of money buying something a year or two old with low miles, and still retain factory warranty.

You will notice on their Auto Navigator tool, that the amount of the down payment will have a sometimes HUGE affect on the APR. Literally, an extra $100 down payment can often produce an APR that is a few points lower. Also, simply adding in a trade-in that may only be worth $100 can often drastically reduce the APR, if you were to have something to trade that may you have a title to that may not even run.

You will have to use a dealership that is in Capital One's network of Auto-Navigator dealers, and you will need to look at a vehicle that is 10 years old or newer with less than 120k miles ( although a vehicle with 110k miles that fits the criteria will only net a 48mo term thus increasing your payment).