Chances of me getting a decent auto loan?

Anonymous · ‎04-13-2012

Hello myFico,

This is my first post on the forums, I have been reading quite alot since I started trying to fix my credit reports about 1 month ago. Learning alot along the way, like the FICO auto enhanced score. That brings me to main point here. Currently myFICO is showing me having scores of 579 and 586. I should hopefully see this rise in the next month since I have two collections PFD already set up and payment is on it's way for both of those. I have 4 other collection accounts 3 of which are small and I am working to remove those as we speak. The fourth one is a little bigger amount and I am having no luck getting anywhere with this OC, they won't even agree to a payment arrangement....they want the whole amount at once and I am not ready to do that just yet. Also just added two new credit cards both for small limits that have not started reporting yet, hoping that this will give me a little increase over the next 6 months as well.

Now for the big question, I understand that with scores around the 580's my chances of getting a loan are not great even with high interest. But since I have been reading about the auto enhanced score I am wondering what I will look like on paper to a dealership. In my credit history I have had two car loans both of which have been paid off on time, no lates ever. One was paid on for about a year and a half then payed off (paid in March 02) and the next one was paid off over 5 years and final payment was made October 2007. Now I know this is just a guess until I go to a dealership but does anyone think that my chances are better for a decent loan with the FICO auto enhanced score?

Thanks and I look forward to your replies.

Revelate · ‎04-13-2012

It really depends on what you consider decent. The Mar '02 paid loan is probably coming off your credit reports in short order; however, the other one should at least keep your auto-enhanced score neutral or possibly higher than your normal FICO pull.

In your case getting the loan is going to be dependent on your down payment; your APR though could be anywhere from 13-20% depending what the score comes back with. I've heard some CU's with scores that are possibly similar to your auto-enhanced (I'm just guessing) that have gone down to around 7.5% but I somewhat suspect those are possibly outliers and I don't know what was in their credit reports specifically.

I don't think you're going to know till you try, but the open unpaid collection is going to be a sticking point when it comes to underwriting.

Creditaddict · ‎04-15-2012

Are you looking to buy new or used?

Do you know what car you want to buy if new or used?

How much do you plan to put down on this car?

Who are the 2 new credit cards you got issued by?

Do you have CarMax near you if you are looking for used car?

Anonymous · ‎04-15-2012

Put 20% down and you will get your car loan.

Creditaddict · ‎04-15-2012

@Anonymous wrote:
Put 20% down and you will get your car loan.

That is way to broad in my opinion....

Anonymous · ‎04-18-2012

@Anonymous wrote:
Hello myFico,

This is my first post on the forums, I have been reading quite alot since I started trying to fix my credit reports about 1 month ago. Learning alot along the way, like the FICO auto enhanced score. That brings me to main point here. Currently myFICO is showing me having scores of 579 and 586. I should hopefully see this rise in the next month since I have two collections PFD already set up and payment is on it's way for both of those. I have 4 other collection accounts 3 of which are small and I am working to remove those as we speak. The fourth one is a little bigger amount and I am having no luck getting anywhere with this OC, they won't even agree to a payment arrangement....they want the whole amount at once and I am not ready to do that just yet. Also just added two new credit cards both for small limits that have not started reporting yet, hoping that this will give me a little increase over the next 6 months as well.

Now for the big question, I understand that with scores around the 580's my chances of getting a loan are not great even with high interest. But since I have been reading about the auto enhanced score I am wondering what I will look like on paper to a dealership. In my credit history I have had two car loans both of which have been paid off on time, no lates ever. One was paid on for about a year and a half then payed off (paid in March 02) and the next one was paid off over 5 years and final payment was made October 2007. Now I know this is just a guess until I go to a dealership but does anyone think that my chances are better for a decent loan with the FICO auto enhanced score?

Thanks and I look forward to your replies.

I probably wouldn't count on much, if any, increase from this. Generally when you have several collections, removing some of them doesn't do much. The biggest score increases will come when the last collection is removed most of the time. Obviously every situation is different, but in my personal experience, and others I have read here, removing 2 out of 6 collections will not likely lead to a change in your score, maybe just a small one. Also, keep in mind whether they are small or big, it doesn't much matter for your FICO score.

The good news is that you have some positive auto tradelines. However, can you confirm that the one paid off in March 02 is still reporting? Generally, positive tradelines will be removed from your report 10 years after being closed. That being the case, if it is still reporting, it won't be for long. With these past positive tradelines, you have a good chance at an approval I think. My wife recently got one with worse scores than you, and a worse situation, but her interest rate was 16.5%. We also had a large down payment (~20%), so that will be important for you. They will also really look closely at your DTI, so hopefully that is good as well.

Ultimately, it depends what you consider "decent." I think you will have a good chance at an approval. However, I do think you would get a pretty high interest rate. Good luck.

jason0618 · ‎04-22-2012

It depends on a lot of factors. Check out my scores, then look at the fact that I have a 60 month loan through Honda Financial at 4.9%. Not the best rate they offer, but still prety respectable for such a low score. Of course, with that low score, there are also about 5 previous Honda loans reporting perfectly from when I had good credit, so I'm sure that comes into play, too.

Revelate · ‎04-22-2012

@jason0618 wrote:
It depends on a lot of factors. Check out my scores, then look at the fact that I have a 60 month loan through Honda Financial at 4.9%. Not the best rate they offer, but still prety respectable for such a low score. Of course, with that low score, there are also about 5 previous Honda loans reporting perfectly from when I had good credit, so I'm sure that comes into play, too.

Wow, you got that from HFS? Do you know the CEO's daughter or something? Out of curiosity when did you get the loan? Pretty much every CSR I know there (including a manager, I know a bunch of employees there since I live not 15 minutes from their place) has stated they were gold-plated only for the most part.

Juss11 · ‎04-23-2012

My niece is the VP personal secretary for American Honda. I'm going to have to hit her up and see what's the deal? I Didnt think they would loan you a postage stamp with those scores!

jason0618 · ‎04-23-2012

Nope, I don't know anyone at all at Honda. Just like I said, I've had several loans with them, all PIF and without any late pays whatsoever. My current loan was opened January 26, 2012. I do know they had to call it in for approval, but I'm quite happy to be driving a brand new car for $369 a month.

Let me know if you need my account number or something to find out why and how I got approved if that's unusual for Honda. The loan has been funded, and I've made three payments already, so I'm not worried they'll change their mind or something, lol.