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Can I get financing?

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PHATB
Established Member

Can I get financing?

I am looking at getting a "new" truck in a couple months and wondering what my chances are.
I am looking to get something 2004 or newer and under 18000.

My Fico scores are Exp 610 , Eq 639 and Tr 608. These should go up in the next couple months because I have a couple collections that are PFD'd and should come off this month. I just opened a secured Cap One With $250 Limit and intend to add $500 more before Oct. I have a Repo from 2008 that was settled in 2009 for less than full. I also have a mortgage that I have had for 6 years but it has been late a lot of that time (I was in construction and fell behind and never caught up but managed to keep my house, maybe I should have let it go, but is current and has been for 4 months with no intent to let it get behind again.) My income is 58k same job for 1.5 years.
Starting scores 03/01/2013: EX 519, EQ 525, TU 508
Present Scores : EX 629, EQ 697, TU 614
In the garden 08/08/13 untill at least 02/08/13


Message 1 of 12
11 REPLIES 11
PHATB
Established Member

Re: Can I get financing?

Oh yeah house payment is 750
Starting scores 03/01/2013: EX 519, EQ 525, TU 508
Present Scores : EX 629, EQ 697, TU 614
In the garden 08/08/13 untill at least 02/08/13


Message 2 of 12
StartingOver10
Moderator Emerita

Re: Can I get financing?

Based on your profile in your post, two things jump out:

1) you have had your home for 6 years and you are current now, but only for the past 4 months (even though you have had the same job for 1.5 years)

2) your income and the rate you are most likely to get given your history.

 

You will probably get approved somewhere, but with a very high rate and a correspondingly high monthly payment. I don't think it is a good idea for you even to buy a truck with financing now. You just got current with your home loan. Any additional payment is likely to throw you back into the situation you have been fighting for years (late pays to your mortgage co).

 

IMO you would be better off in the long run by staying current on your mortgage for at least a year to show you can make long term payments timely. That way, when you do buy a vehicle that needs financing, you can point to the stabilty you established over a year, rather than 4 months. Even then you will need to go to a CU and get your financing there rather than a dealership. Once a dealership see's your history they will hit you with a very high interest rate.

 

In the meantime, get an older vehicle for cash. You will probably have to set aside funds for repairs, but you would anyway on a ten year old vehicle that you were planning to buy.

 

You are on the right track to showing ability to pay. But 4 months is just not a long enough history to show that you are actually able to handle another installment payment. Good luck. Give yourself a break - don't add more payments now.

 

 

Message 3 of 12
StartingOver10
Moderator Emerita

Re: Can I get financing?

I just saw your house payment now, even though it is a very low payment. It is the fact that you weren't able to make timely payments the entire six years until recently. Given your history, your vehicle payment could actually end up being a huge payment (400-500/mth). Don't put yourself under that kind of pressure.

Message 4 of 12
PHATB
Established Member

Re: Can I get financing?

Well I had other financial obligations and I was just "treading water" to get by. If that makes since? The economy hit me pretty hard. The old repo paid for less and the mortgage being the only baddies that will remain after this month. I have quite a few other accounts paid in full and a couple revolving furniture accounts. I also have a car loan for 16000 paid in full in 2007. I am a member of a credit union and I have been since I got the job I have now. It really wasn't a matter of not paying my bills because I was iresponsible, it was me doing the best with what I could make and keep a roof over mine and my wifes head and keep food on the table until I could find better employment. I have a couple other trucks I paid cash for in 2009 and I'm just getting tired of working on them. I don't need a truck necessarily just would be nice to have something with a/c lol. My scores were in the low 500s a year ago and I have worked hard to clean up the reports to get where I am now. I do not want a payment of 400 or more. if that would be the case then I can certainly wait.
Starting scores 03/01/2013: EX 519, EQ 525, TU 508
Present Scores : EX 629, EQ 697, TU 614
In the garden 08/08/13 untill at least 02/08/13


Message 5 of 12
PHATB
Established Member

Re: Can I get financing?

All my other loans and revolving and student loans etc are all in good standing and have never been late.
Starting scores 03/01/2013: EX 519, EQ 525, TU 508
Present Scores : EX 629, EQ 697, TU 614
In the garden 08/08/13 untill at least 02/08/13


Message 6 of 12
PHATB
Established Member

Re: Can I get financing?

Oh and actually now that I have no other debt (I have paid it all off since I started working where I work)I save a lot of money. My wife also make 45k so a payment wouldn't put me behind ever again. The reason it took me 1.5 years to catch up was paying everything else off and a little extra on the house every month as well as buying my wife a newer car ( I made the down payment she got financed with 680 score through nissan for a new altima in Nov last year) my main reason is I would like to get an auto loan to show I can make auto payments again as well. This time we are a lot more responsible and have reserves saved up as well. I hope all of this makes since? My financial picture on paper is better than it sounds trying to explain here. I'm just paying for the past.
Starting scores 03/01/2013: EX 519, EQ 525, TU 508
Present Scores : EX 629, EQ 697, TU 614
In the garden 08/08/13 untill at least 02/08/13


Message 7 of 12
HoldingOntoHope
Valued Contributor

Re: Can I get financing?

I know you see your financial picture as OK and you are probably right. But as stated above a lender is going to go over your credit report and what they see is a history of late payments and a repossession on an auto loan. The good installment history prior to those events has been wiped out by the recent derogatory information. If you really want to find out for yourself then go to the dealership and let them run a credit check for financing on a particular vehicle. I do believe that you are going to need a 20 -30% down payment and still get stuck with mid-teen or higher interest rates.

 

As posters above had said if you want to set yourself up for a decent loan rate you will need at least a solid year of no derogatory information and I personally don't believe that even that is going to be enough. I think you will need 18 months or more to get a sub 10% interest rate.

Best financial advice I ever got: "Just imagine what an adult would do and do that."

Starting Score: 500's
Current Score: EQ 701 (FICO) TU 721 (FICO) EX 715 (Quizzle)
Goal Score: 760 ALL


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Message 8 of 12
PHATB
Established Member

Re: Can I get financing?

I understand. Honestly that's what I knew to be true its hard to hear. There was a time 8 year s ago when I had scores in the 790s. I'm just glad to be where I am now after what happened. I appreciate the input. I will continue to build my credit using what I learn on these forums.
Starting scores 03/01/2013: EX 519, EQ 525, TU 508
Present Scores : EX 629, EQ 697, TU 614
In the garden 08/08/13 untill at least 02/08/13


Message 9 of 12
StartingOver10
Moderator Emerita

Re: Can I get financing?

You can do it. Believe me, I understand about the economy. I had a difficult time too and I am rebuilding (that's why I'm here). But one thing I have learned is to make sure that the timing is good for me...not for the dealer.

 

The last time I financed a vehicle I had just come off a BK and I waited two years to get a decent vehicle with a decent payment. I built my score up to the low 700's and I still had to negotiate with the F&I guy from some ridiculous mid teens rate down to 7.14%. But he went kicking and screaming the entire way....lol

 

There are two things you need: 1) showing the ability to make the payment and 2) the stability to make sustained payments over the long term. (Plus maybe gall to negotiate with the F&I guy and a pre-approval with a CU to show you are good for it).

 

Just trying to give you the tools to get the best rate possible under the circumstances. Most of us are here rebuilding....In fact, I just saw a post not too long ago from a guy that had just had his discharge from BK and he was able to get zero percent! So the criteria is a little better now, just put yourself in the best possible position before you apply and waiting until you have 12 months of house payments made on time puts you in a much better position than 4 months.

Message 10 of 12
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