High income but Muh Credit Score...Will I Get Approved for 100k Car Loan?

[LallaBabba]

So my financial situation is outlined below. Wondering if I should try for 110k car loan or wait. 

Credit Score: 646

Income: 408k

DTI: 1%

Negatives: 3 old charge offs for small amounts (I wouldve paid these off but heard that paying could update the account and actually lower my score, true or nah?)

[kilroy8]

Even if you can find a loan, the rate would be murder.

Get rid of baddies, use the tips on this forum to bring score up some, then try.

[FireMedic1]

Settling CO's will raise your scores. It affects your aggregate util %'s in most cases. As you posted they're small CO amounts. You make 400k and want a 100k car loan? Settle the CO's and that will make it easier to get a loan. Owing on CO's the loan officer could look at it as well they didnt pay those. What if they cant pay us? Make sense?

[Mdowning30]

If your income is $408,000, you should just settle the full amounts of the collections and it will boost your scores towards the "Good" range. Also ask yourself do you really need such an expensive car, or could you settle for a fully loaded car in the 40-50K range ? 

[LallaBabba]

Ok I paid the charge offs a couple days ago. As far as if the car is too expensive, I don't think so. My monthly payments will be only 2k. After taxes, I make 24k per month and my wife brings in another 9k. I don't have any other debt right now besides her car which is $800 a month. I don't spend money on drinks, coffee, gambling or anything lol. I think I should be fine? 

[CYBERSAM]

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@LallaBabba wrote:

So my financial situation is outlined below. Wondering if I should try for 110k car loan or wait. 

Credit Score: 646

Income: 408k

DTI: 1%

Negatives: 3 old charge offs for small amounts (I wouldve paid these off but heard that paying could update the account and actually lower my score, true or nah?)

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@LallaBabba  You should be able to get a loan. However you probably need to put down more money! That is the trade-off for better credit. Getting that loan also is going to improve your score in the future.

Depending on the term you going to get, by next year or so you can refinance once your score improves.

You probably can have it as writeoff anyway based on your income!

What car you going for?

[LallaBabba]

Update...paid off all of my charge offs pretty much same day as making this post. One has updated on my report so far and score went up 36 points. Interesting this was a $233 charge off, the rest are over $800 so curious how much of a bump I will get from those. Current fico 8 is at 698. I'll have to apply at the end of October so I have about 3 weeks left. Praying those other chargeoffs are updated soon! Thanks for the tips!

[LallaBabba]

Going for a 2023 X7!

[FireMedic1]

@LallaBabbaNice. CO's are considered a maxed out 100% or more if the balance is over the CL util %. Killer for scores. Getting them to $0 balance no longer counts against your aggregate util %'s. Enjoy your new ride!