HELP! Ready for new car sooner than expected

[FirstAscent]

Hey everyone, Looking for some much needed advice. In the last 2 months alone I've raised my scores 60-90 points across the board which I'm super excited and proud of myself for =) thanks to all of you and the multitude of knowledge on here. 

I wanted to wait until at least one of my scores were at 700 but I have an opportunity through work right now for a new work vehicle incentive program where I'll have about $4-600/month reimbursement on a vehicle. Which will offset my payments quite nicely. I'll have about 1-1/2 months to find a vehicle but I'd need to decide if I want to take advantage of this program fairly quickly, within the next week or so. 

With that being said, my FICO8 scores are now OK in the 670's. I've done a ton of research to find out what banks/Credit Unions pull which bureau and which scoring model so I can use that in my favor. I obviously want to start with the best rate I can get and can always refi in the near future as my scores to continue to grow. I'd be super stoked if I can stay below 5%, I'm not sure how realistic that is with my scores but that's what I want for now =) 

COSIGNER- Ugh, this is an absolute last resort, but I really want to avoid a substantial down payment. As a last resort I could probably get my dad to co-sign but then again, I'd really only want that to be for the shortest amount of time possible until I can refinance in my own name. My GF would co-sign for me if I asked, she has excellent credit (about 780), but she also makes less than me, about $55k, so I don't think that would work very well for this vehicle amount.

STATS:

Income: $90k

Vehicle amount: ~$67k

DTI: 8-9%

All my Auto Enhanced scores and FICO9 scores are lower, so I'm not looking at any banks that use those. Auto scores are in the 650's.

FICO8: EQ 673, TU 674, EX 678

TU FICO4 662

EQ FICO5 (mortgage) 661

EX FICO2 652

I haven't found anyone that uses bankcard scores for auto loans yet but I have some of those scores in the 680-690's, I just assume nobody does

EDIT: wanted to add the CU's I've looked at from the research I've done and what I "think" they pull.

OnPoint CU - EQ FICO5

NFCU - maybe TU FICO4 and/or EQ FICO8

DCU - EQ FICO5

Community America CU - TU FICO8

First Tech CU - EX FICO2

[Anonymous]

Any negatives on your reports? Prior auto loans? Installment loans of any type? Revolving accounts? AAoA?

Make/model of vehicle?
New/Used?
Any down payment?

Based only on what you’ve put down, I’d say not a very good chance for under 5%, but that’s subject to change depending on additional information. There’s a lot more involved than just scores, income, DTI.

Curious myself to see what other people think.

[FirstAscent]

Yup still have some negatives on my report, paid collection about 5 years old. late payments on my last auto loan, it was paid off in full 2 years ago. Late payments on my student loan as well. Nothing bad within the last 13 months, which I know isn't that long. 

Only open accounts are student loans (4) and 1 credit card at 1% utilization, it's 2 years old with a perfect record. AAoA is about 7.5-7.9 years. One closed auto loan from about 7-8 years ago that is clean. 

New Vehicle

Jaguar F-Pace

Down Payment: $5k, I can do $10 but I'd rather not.

Can I negotiate lower APR in return for higher down payment?

I could be wrong, and I know each CU is differnet, but it seems some base the APR off of credit score but they obviously take everything into account as far as if you are even approved and required down payment. I've heard of people getting below or around 5% with scores in the 670's but I also don't know what the rest of their report looks like, and mine definitely isn't perfect.

[FirstAscent]

For fun I just checked out the Capital One Navigator site just to see what it said, unfortunately you can only be pre-approved from $4-40k but I figured it’d still be somewhat of a baseline I can use.

It said I was pre-approved for the max which is $40k. I looked at a handful of random new cars and they were all from 3.24-4.7% depending on whether it was 60 or 72 months

I have no idea what scores that’s based off of but I’d be stoked for that APR. Given this info from the Cap One site, do you think that gives me any hope on a more expensive vehicle with an MSRP of $67k?

[pipeguy]

After looking at the math, $65k loan for 60 months at 5% apr = $1226.63 a month  (at 7% it's $1287.08 a month), I'm wondering if revising your vehicle would be a better choice in getting the loan you want. I understand that you can get a "subsidy" of up to $600 from your job, but that locks you into that job for 5 years assuming a 60-month loan,  or any situation where you are laid off such as a company downsizing. 

I'm assuming you are young based on your post (GF or Dad cosigning, student loans, etc), it just seems to me that a lender would be concerned with a borrower who is younger with prior credit issues more on a higher priced vehicle that will lose value quickly, quicker than you'll pay back the loan.

Note that I have a personal "rule" never to allow my car payment to be higher than my mortgage payment, so I might be biased toward a $1200 car payment before considering insurance and upkeep. 

[FirstAscent]

@pipeguy Thanks I appreciate your honest opinion. 

I'd be looking at 72-75 month loan and would be putting a small down payment down, my rough calcs put me at a max of $950/month which I'm very comfortable with. 

Obviously nobody's job is ever 100% secure but I'm in a pretty good spot right now and my environment is very stable. The company is also very large (worldwide) and I can easily transfer to a different branch in the same state, out of state, or even out of country if I wanted. 

However, you always need to plan for the worst, and if something bad were to happen I can always sell the car at any point in time.

My last auto loan (newer Tundra) was $50k and I paid that off 2 years ago, I was OK with those payments without any subsidy. I still have this truck as well and since its paid off if a good fail-safe if something bad were to happen. I have a custom Ducati I built I could sell for around $20k if i ever HAD to, but i never plan on doing that haha. 

I'm not too "young" I just didn't go to school right away, until late 20's. I'm mid 30's now. Also, since I bought my last truck brand new, I am well aware of how quickly they depreciate the second you drive off the lot haha. I definitely didn't pay attention to my credit much before either, obviously, or I wouldn't be rebuilding now =)

I do appreciate your input, it's always good to look at all sides when making a big purchase like this.

[FirstAscent]

Not quite ready to start applying for loans yet but in preparation I applied for NFCU membership and setup a savings/checking, so that part is ready since they are a potential CU I’ll be talking to.

Everything I’ve read says it’s a HP for membership. The lady I spoke with said it’s only a soft pull. I guess I’ll see if a couple/few days if an inquiry shows up. I will say I’ve never had a better experience setting up a bank account though!

[pipeguy]

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@FirstAscent wrote:
Not quite ready to start applying for loans yet but in preparation I applied for NFCU membership and setup a savings/checking, so that part is ready since they are a potential CU I’ll be talking to.

Everything I’ve read says it’s a HP for membership. The lady I spoke with said it’s only a soft pull. I guess I’ll see if a couple/few days if an inquiry shows up. I will say I’ve never had a better experience setting up a bank account though!

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NFCU will treat you right and generally have very competitive rates - I just refinanced my home at 3.5% through NFCU.  NFCU will also go up to 96 months on a vehicle loan, but the APR is almost double that of a 60-month loan.

BTW, glad to hear you are in your mid-30's as a bit of age = a lot of wisdom and a bit of reserve versus some of the 18 to mid-20's y o that think nothing of spending $100k on a "sexy" vehicle (they rarely check back in a year or two later and say how pleased they are with their purchase/payments). 

[FirstAscent]

Thanks, I've heard nothing but good things about NFCU, no local branches but I'm ok with that, I go to a physical branch maybe twice a year anyway, if that. 

Yup, I get it. what 18 yr old wouldn't want a sexy $100k vehicle haha. if only money weren't an issue lol.

figuring out now how much of a time spanI have in order to make sure upcoming loan inquiries get counted as 1 for FICO scoring

[Anonymous]

NFCU is a great place. DW just financed her Wrangler Sport S with them at 2.99%  We had a time out on their system glitch and item go into spam glitch but service is very good terms even better.