College Son (20) First Car Loan - Income---Full Scholarship/Summer Job/Part time School Year

[LifeSAVERS]

Been off the forum for about a year...no idea where that time went!

My DS (20) is looking to purchase his first vehicle and acquire first vehicle loan, drive back to college this fall (WA to NC).  We are hoping to make the application with DCU and am providing the following outline as a student and summer/college W-2 income:

Full time student, starting 3rd year at Duke, with a full scholarship (meals, room and board,health insurance, tuition, etc) at Duke, over $76,000 a year.

- Meals and housing provided at $7200 (meals), $7200 (housing), and $2600 Health Insurance, or $17,000 for 9 months (school year)

- Summer full time plus overtime (avg 115hrs bi-weekly), as manager at local DQ, $8000 for the summer.

- Part time college work during school year, paid directly to him from college (student supervisor at local campus grocery type outlet), approximately $550 per month ($4,950 during 9 month school year).

Total Income:

Jobs - $12,950 (W-2 Wages)

School Paid Health/Meals/Housing - $17,000

FAFSA - $5500

Combined: $35,450

Credit Information:

Score: 712

CC: WF $800 (10% balance) - Since January 2016 (1 year 6 months reporting 100% positive)

SL: $10,000 (Student Loans from past 2 years - items not covered by Scholarship - laptop/supplies, trips home, books, minor household items).  Showing as Current and on time, but payments not due until finished with school.

Question:

How will DCU (or any loan entity) look at money received from college scholarships for housing/food/health insurance, which are normally part of household living expenses?  Same with potential Student Loan funds available of $5,500 per school year.

Car Loan 

- $7500-$11,000, on used 2008 - 2010 Audi.  Up to $3000+ down, however, I would like to see him keep as much from the summer job in savings through school year to cover repairs, emergency expenses, etc.

Would like to see his car payment be under $180 and could be automatically withdrawn from a DCU account that we could have his Duke student payroll direct deposited into.

Note - sat down with Wells Fargo (checking and credit card banking institution), they were providing a 14-18% interest rate and not really the way to go, especially with information and experiences on forum here.

Any words of wisdom, suggestions welcomed!

[Anonymous]

I can't see your son getting a good rate on his own (if he can get a rate at all with the proof of income he has), so assume you would have to co-sign. Your scores are average, but you're looking at financing a car that isn't just used, but several years old. That won't do any favors for your rates, either. 

I think what Wells Fargo's risk analysis should tell you is to reevaluate. Can he buy a car with his limited income and you as a co-signer? Yes. Should it be an 8 year-old Audi that will be difficult to get a decent rate on and expensive to repair? No. 

I think you should be looking at vehicles 2-3 years old that you can finance more easily and that will likely have lower repair costs. You can get a perfectly acceptable used Corolla much more cheaply than the Audi, (or for the same price, but much newer than the Audis you're looking at) and it will also be easier to finance and cheaper to repair.

[Gmood1]

Does he have a way to try Navy Federal? Step daughter 20 yrs old financed her first vehicle 2 months ago. They gave her the lowest rate available on a 2010 Honda Civic for 48 months.
Her payment is around $147 a month with no money down.

I did prime her credit up over the last year with a shared secured loan and 3 CCs. Her income is only around $8000 she's also in college.

[Anonymous]

For a first car to a student  they will be looking for a cosign.  I beilieve something that old will be hard to finance.  Try something newer easier to finance and repair. 

[djmax041]

Well from my experience DCU is pretty good at giving good rates 

when given the approval they normally give you a rate before you decide on which car youre getting 

but from what I know the rate can vary depending on the year and model of the car 

the good news is that youll get a rate deduction if you have direct deposit in dcu I remember when I purchased my 13 camaro it went from 1.99 to 1.74 when I enrolled in direct deposit.

All I did was deposit 120 from my check every week to the bank my car payment wasnt even 250 so it worked out.

Honestly I would consider another vehicle  $7500-$11,000, on used 2008 - 2010 Audi most wouldnt even finance that if your look at a 3k down payment financing bewtween a 5-8k as a first car I would look at something else audi maintenance and upkeep is expensive as a first car you wouldnt want to be paying on a car while getting it repaired.