Curious, your thoughts.

[Dj4Money]

 I recently applied for a auto loan through SDFC as they have attractive rates. My EX came back 639 (dropped to 635 via CS same day after IRQ). I got all the paperwork from DocuSign in my inbox now.

 My second pay check and stub has been published on my job's website (Direct Deposit). I asked the loan rep about min income and she said that it's a factor but they don't have a min income.

 Well my pay stubs are a joke, I've only been paid for training and working last Friday (Black Friday). Thus far I haven't been able to pick up any more shifts. Today I interviewed for another job, did well and might be hearing back from them; this is for a store opening.

 Now with all that said, I do have income both earned and unearned; totalling $755 a month. As I have mentioned in my other main thread, I have restarted my DJ business and have had to pass up gigs because of the lack of transportation. I did one gig using the bus and I was thankful and lucky the client was able to give me a ride home.

 Long term that is not practical at all. Capital One had mailed out my card, it should be here in the next 48 hours or so.  The balance isn't high enough to rent cars yet, though I can send in another $100 to make that possible. I put a deposit of $275 on my SDFC secured card and could up that by $25-$50 as well. Again that said, doing that more than twice a month is easily a car payment.

 So while I violate my own suggestion of 15% of income for a car payment it's necessary at the moment. If I continue to work and take DJ gigs, being out when the bus isn't running or is running every 50-60+ mins is becoming unbearable.

 Plus I am an auto enthusiast, I love cars, I go to shows, to races (annual trip to the Long Beach GP) and I drag race on a regular basis. I can't drive around basic transportation, not with my own money.

 So I have set a max payment of $235 which is about 31.5% of my current earned and unearned income. I came across per mile insurance offered here in California. I am aware that Progressive offers the same and I have a quoted a rate of $50 a month. I may be able to get standard insurance (based on US averages for mileage) for maybe a little more, but I think this is worth a shot - https://www.metromile.com/

 That would leave plenty for fuel and maintenance, the car I have in-mind takes synthetic oil which monitored can go 5,000 miles between filter changes. I did this on my other car, had the oil analyzed, no issues with wear.

 I can show all my income so I was going to send all that, along with my puny pay stubs, a short explaination and hope the underwriter understands.

 My original plan was to wait until the end of summer and pick up a new car. However, I would get used but I specific desires and they'll fit within my budget.

 I know my total income as shown is far below a student that was approved by a credit union ($16,000 a yr) - http://ficoforums.myfico.com/t5/Auto-Loans/Auto-Loan-Approvals/td-p/252350/page/240 (6th approval) and lower than most people on SSI-D/SSI, though some on SSI make about what I do a month.

 Just wanted to hear your thoughts on approval, I am going to send in all the stuff tonight or tomorrow and likely get an answer Friday, Saturday and no later than Monday.

 I would be borrowing up to 125% to preserve my cash, the amount borrowed will will be around $11,200, or slightly more to like I said cover the closing cost.

 KKB and others say the car with the options I want will easily fall into the mid to high $10K. The mileage might be a little high but for example found the exact car I want for $13,890, my other choices are quite a bit less actually and fewer miles.

 KKB = $11,203 Fair Price

 NADA = $11,500 Clean Retail

 Edmunds = $10,243 Dealer Retail

 Thoughts and please don't suggest buying a clunker. I won't, refuse to and will continue to walk, take the bus, bum rides. I can make my payments, had no problem previously, some unusual circumstances lead to my previous car's repo but payment history is perfect on all there reports.

 That won't happen again, lesson learned about accepting pain when you have too and not side step it for short term gain.

[Dustink]

It looks like you are setting yourself up for another repo.

High LTV and low income.

[Dj4Money]

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@Dustink wrote:

It looks like you are setting yourself up for another repo.

High LTV and low income.

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 How so? I make more unearned than what the payments will be (year to year), including insurance, fuel and maintance ($5520). IE, I do nothing and I make $6,094 a year.

 By the time the payments start, taking the 90 delay and assuming I take delivery in mid to late Dec. I will have amassed not only Dave Ramsey's Baby Step #1 but also have at least three to four months of auto expenses including payments in a seperate account. 

 I wasn''t doing this in 2006-2009. I should have paid the car off in 2007 after my father passed away but I wanted to build my credit, maybe that's why my EX score is still 635...

 I could do a few Craigslist DJ gigs (which I won't) that's another $9600 a year ($200 a gig, four times a month, very modest), tax free (no business license). My friend will give me about a 1/4 of his gigs as he wants to do more events overseas and spend more time with his woman in the Dominican Republic where he also has a residency (and a house).

 His average gig is $500, with a majority of them being $800-$1200.

 I will generate more money doing what I want and doing nothing than I ever did "working" for somebody in 2015 and will only increase.

 A  car is needed but I won't drive buckets, basic transportation or appliances.

[Dustink]

Do you live somewhere that you can do the hourly car rentals that are all over? Or rideshareing? Use these when you have high paying gigs. Save up enough for a good down payment so that you are never upsidedown on the loan. At least 20% down on a very well negotiated deal with a short term loan, more down for anything else. If money is flowing as well as you anticipate, this won't be an issue. If it is an issue, it means you can't afford the car.

Starting off at 125%LTV with insufficient consistent income to support the loan is a recipe for disaster. Always being in a position that you can offload the car and pay off the loan is what you need right now. If you end up under contract making more than enough, then 100% LTV is a little less risky.  

[Dj4Money]

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@Dustink wrote:

Do you live somewhere that you can do the hourly car rentals that are all over? Or rideshareing? Use these when you have high paying gigs. Save up enough for a good down payment so that you are never upsidedown on the loan. At least 20% down on a very well negotiated deal with a short term loan, more down for anything else. If money is flowing as well as you antisipate, this won't be an issue. If it is an issue, it means you can't afford the car.

Starting off at 125%LTV with insufficient consistant income to support the loan is a recipe for disaster. Always being in a position that you can offload the car and pay off the loan is what you need right now. If you end up under contract making more than enough, then 100% LTV is a little less risky.  

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 Understood -

 Lyft and Uber are both available here. I just got my Cap One card in the mail today, I can actually use those services now. Car sharing companies don't have any cars local to me, most of them are 50-60 mins away by bus.

 By the way I couldn't use any of these services until today, no credit card...

 This and car rentals are apart of my original plan. I would continue to improve my scores and put down 20% about this time next year and get something new.

 However the more I thought it was possible the more I wanted to try and at least see what happens, all they can say is no or give me an amount I can't work it.

 The main problem I have is that using rentals and ride services would easily amount to the cost of owning a car. I would be still be stuck with the grinding commutes to whatever job I have or being limited on how late I can be out. It might cost me $20-$30 to drive down to Costa Mesa in my own car (fuel, insurance and maintenance), while getting a rental would cost at least double that.

 One of my other friends has been using rentals exclusively and averages $90 for rentals Friday to Monday. He will be relocating to the Pacific Northwest and it will cost him less to put his stuff in a mini van or SUV than it will cost to rent a truck at U-Haul or Ryder, but still run $300+ since the rental company will have to recover the car from his new city. 

 Rentals and Ride Sharing is really for people that have built their lives around public transportation, riding bikes and walking medium distances; typically living downtown or mid-town.

 I live in the suburbs, really not practical. Larger DJ gigs would require at least the car I have in mind, most Uber drivers have Camry's and Pirius...

 I end up taking the bus the wrong direction to work the other day, had to walk three miles and ended up 20 mins late. City Taxi wanted to charge me $12 to give me a ride for 2.5 miles... $8 got me about five miles in Las Vegas recently when I had missed the bus that would take me directly to my hotel near Fremount St.

 I have adjusted my life to using public transportation, but it has it's obvious downsides. That has limited how often I actually do get a chance to network and socialize (important for DJ'ing) when I have to leave early to order to get back home at a reasonable time.

 If the penatly for that is to be slightly upside down initally in a car loan, so be it. I could always go back to being a courier (delivery driver) or deliver pizza in the short term and double up on car payments.

 I see no downsides to this, I see possible problems but saving for a rainy day is key and eliminates many of those problems short of falling ill or worse.

 As I said I didn't know in 2006 or 2009 what I know today. If I had known, I would have paid off the car in the first place and would be making at least 700hp and bought a 2008-2009 Volvo S40 which was the original idea. I had given up doing mobiles back in the early 2000's because I never met anybody making any real money doing it, I still DJ'ed at home and did occasional parties.

 However I did meet somebody who does manage to make real money doing it part-time. That is the same guy who told me verbatim that he would give me some of his gigs so he could spend more time with his GF and her children in the DR.

 Waiting until I start generating the majority of the money I predict will materialize might seem wise and the Dave Ramsey thing to do, but I think it's a small risk and I would start generating serious money maybe as soon as Christmas or New Year's Eve.

 For that I need a car, my own car preferably. 

 Thanks for the input and I see/understand your POV.

 PS - I must say that my repo did not happen because I lost my job (I was still working), it didn't happen because I couldn't afford the car (I was making on-time payments up until they sold it at auction), it happen because of a set of strange circumstances that is directly connected to dealing with people I was totally unfamiliar with to avoid the short term pain of paying $100+ dollars to tow my broken car from Riverside back to the San Fernando Valley.

 I had the money, it just would have emptied my pockets completely at that moment. I have more clarity today than before; I tolerated a poor paying job just so I could continue to make car payments, make upgrades to the car and take it to the track. Once I lost the car, I could care less about the job, let it lapse and was fired months later at the start of 2010.

  Finally I understand what makes me tick...

[Dustink]

Good luck, Uber is cheap. Less than car ownership for occasional gigs. Tip the driver a few bucks and they won't care how much you pack in their car. I'd suggest you go that route for awhile just to make sure you can make the money you think you can make.

[Dj4Money]

 Sure Uber is cheaper than outright ownership if you don't go anywhere much.

 Just an example, I was going to go to a certain party about 40 mins by bus. Okay the party gets really started around Midnight; well guess what I have to jet because the bus I need to take without walking 3.2 miles back to the house is leaving around 11 by the time I get the station I need to take the 2nd bus. I am talking about an urban area here (San Fernando Valley), several posters on this forum know where I am talking about the necessity to own a car.

 I put Uber on my phone only to find out they only take actual credit cards, not debit cards and not pre-paid debt cards. Ah, millennials think nothing to excluding certain segments of the population. 

 Another example, some fellow DJ's invite me to one of their events in Orange County (So Cal residents know where I am talking about). It took me 2 1/2 hours to get there using the train and then walking the last mile and a half. Once again I had to leave around 10:30pm otherwise I wouldn't be home until sometime next morning, well I call 4:30am the next morning and that's without waiting too much for the bus, subway or bus again.

 I haven't even gotten to the point of working for Footprint Retail Services and unable to do much of the work because it's on the other side of LA County. What I am suppose to do, show up several hours early, get a motel room for before and after the assignment?

 I think that's a bit unreasonable.

 The per hour wage has gone up to $12 an hour, which more than I can say for Harbor Freight or Macy's who are all paying $9-$9.10 an hour.

 I've been employed by Footprint since late last year, only worked once since it was local to me.

 Like I said, I would stick to the original plan, but the chance to be apart of my friend's 2015 plans, so he can start shaping his time off is becoming crucial. 

  The gigs won't be occasional, we are talking three-four times a month and likely a residency somewhere. Not to mention, client meetings, equipment repair, equipment rental, self-promotion, socializing and networking.

 Just to make sure???? I've been doing this since 1986; as I said no mentor to help me, no successful DJ's around me, until now. I have a chance to develop some links of my own, return gigs, referrals,  which I currently don't have very many of.

 I submitted the paperwork, a note to the underwritter explaining some of what I have just told you and all the sources of income I have.

  Hope to find out around Monday, maybe Saturday. 

[Dustink]

Pretty sure you can use PayPal with Uber. It's like $1 per mile. You could use it several times per week and still be cheaper than car ownership. I know people who own a car and still use it daily. I own a car and still find myself using it often. Often it comes out cheaper and you have a driver.

Either way good luck. Hope you get the loan you want and everything works out.

[Dj4Money]

 Well, I got the news and I was denied.

 Reasons -

 1) 120 Days Late on School Loan

 2) Active Collection (Midland)

 3) Charge-offs ($2070 to Wells Fargo; Car Loan and $431 First Premier CC)'

 The School Loan is deferred intil March 2015. That said, I can start making payments this month if needed. Now with that said, the loan has been turned over to Great Lakes and I want to confirm that if I start payment that the late pays get removed after nine months.

 Midland has been contacting me via mail and by phone for the last three-four months. They will not take PIF for Delete, so they have been pushed down in importance. I have other things that I need to take care of, plus long communites just to do basic things to fool with them right now by pestering them.

 The Charge-offs I still deem not nearly as important as the late payments on my school loan.  The active collection just adds fuel to the fire...

 So while I need a car, I will not compromise to the point of getting clown cars and/or high interest rates.

 The rep on the phone said to try back in six months. I don't know what impact that would make; I know my score will go up as the credit cards start reporting. The only thing I could pay now is Midland and possibly First Premier but neither will take a PFD.

 I am sort of deflated and think only higher scores and downpayment (the amount I asked for would have covered everything). If this is the case, then like I said paying the larger of the two charge-offs would be off the table, that money would be used for down instead.

 In fact this was confirmed by my other CU (Logix); at least 15% down, franchise dealers only (and in-state only) Car Max and Auto Nation all included. But the capper is this, only 85% is provided for used cars.

 Also six months later would mean that my school loan balance would only have come down $300, still only 5% DTI and the late payments would still remain for at least three more months.

 So it looks like at least for six months, it will be Lyft, Uber, Bus/Train/Plane and car rentals. That was the original plan anyway until month nine, first card was activated Dec 5th; nine months would be August 2015.

[Dustink]

I think the bank asking for a down payment is completely understandable. You can get a free first ride https://www.uber.com/invite/uberdustink on uber using that link. Keep working on getting the score up and saving a down payment. You will have your own wheels in no time.