I bought a 6-year-old pre-owned car in February 2017. This was my first car purchase. Unfortunately, this car has begun to have cost-prohibitive mechanical problems. It needs upwards of $9000 worth of repairs, is no longer safe to drive, and was appraised by Carmax at only $9500 before the CEL was a permanent fixture of the instrument cluster. I paid approximately $24,600 for this car with taxes, warranty, and fees. The price of the car was approximately $19,600. I was refunded the money for the warranty because it was inapplicable. I also received a $500 additional refund. I put down $4000, leaving me with a loan of $20,600. The loan was opened jointly with my father. My remaining loan balance is approximately $15,400. I have the ability to pay either the upside-down balance or repairs. I think the latter is irresponsible, and both a dealer and an independent mechanic have told me as much.
If I choose to get rid of the car, I am only interested in leasing a new vehicle. This 6-year-old car is loaded with features and originally retailed for approximately $74,000. I am looking at new cars of a similar price point from Land Rover, Mercedes-Benz, and Volvo. I am concerned about my credit profile, more than my scores. My scores are below 700, but that is because I am carrying a balance on my credit cards right now. The score estimators all point to a FICO above 710 if I pay them all off.
I have four credit card accounts in my name. I will list them:
American Express - $5,000 limit - opened 10/2015
Chase - $5,000 limit - opened 4/2016
Barclays - $600 limit (down from $1,500) - opened 9/2016 (used to finance iPad with no interest) - one unintentional 30-day late payment in 8/2017, and my only derog ever
Capital One - $1,750 limit - opened 11/2016
Total revolving limit: $12,350
I also have two loans in addition to my auto loan:
CU - $1,500 secured (24 months) - $69/month - opened 12/2014 (closed, paid as agreed)
City National NJ - $1,000 secured (12 months) - $89/month - $356 remaining - opened 2/2018 (open, pays as agreed)
I have two authorized user accounts:
Capital One - $500 limit - opened 1/2017
Chase - $1,500 limit - opened 8/2006
As you can see, my credit profile is not that old but isn't terribly new. I am looking at 36-month lease balances between $30,000 and $43,000. Am I aiming way too high? Thanks!
I was recently approved for a Capital One auto loan refinance at a slightly lower interest rate, but I declined. I was also pre-approved for American Express Platinum, but I declined because of the annual fee.
I visited a local Land Rover dealership and spoke to the finance manager. He said a 700-720 score is Tier 2. I also told him about my credit and loan history. He said it sounded approvable. I am a little skeptical. Should I be?
I have no plans to apply until I am over 700. My scores are low because my balances are too high. They are way high. I got sucked into zero interest offers.
I don't have under 20% utilization, so getting there would be a huge step in the right direction.
20% utilization isn't what you should be shooting for, > 8.99% is. Even better, AZEO would put you at 1%. What is your utilization now?
Also, don't underestimate the impact of that 30 day late. It's barely over a year old which means it's dinging your score a good 60+ points.
As the poster above said, the score simulators are worthless.
You need to gain more than 100 points in order to be tier one, and that's no mean feat. At least not quickly. The best way to do that is to employ AZEO and get that 30 day late goodwilled. Meanwhile, you can pad your utilization by soft pulling your way to higher limits and paying down your debt.