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Lender For Older Vehicle

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Zosimus
Regular Contributor

Lender For Older Vehicle

So, my 18-year-old son needs a car. We found this nice 2004 Lexis for sale for $4,500, but our local credit union doesn't want to finance a car that old.

 

Should we try for a newer car or find a different lender?

 

Here's my son's credit profile.

IMG-20240606-WA0000.jpg

 

3 tradelines

AAoA 4y3m

100% on time payment

1% utilization

AZEO


14 REPLIES 14
JoeRockhead
Senior Contributor

Re: Lender For Older Vehicle

It's typically harder to find financing on cars older than 10 years, mostly because a lot of lenders consider the collateral more high risk. Unsecured personal loan... or, newer vehicle might be the best options.

Message 2 of 15
pizzadude
Credit Mentor

Re: Lender For Older Vehicle

Two questions here - first around older vehicle financing, I agree with the above post, you may need to pursue a personal / unsecured loan.   And given the relatively low price of the car even with higher interest rates it hopefully won't be too bad but you'll likely need to co-sign.

 

Second question, around your son being able to get a loan and establish credit -  in this thread you mentioned your son was offered a 28% interest rate on a car loan, this was for a newer vehicle ?   Also the scores you posted above aren't relevant as I'm not aware of any lenders who pull Vantage for secured loans.   Does your son have FICO scores ?

March2010 FICO® ~ 695 TU, 653 EQ, 697 EX
Message 3 of 15
Horseshoez
Senior Contributor

Re: Lender For Older Vehicle

@Zosimus, shop around, there are plenty of credit unions (and probably banks as well) who will finance a car that old.

Chapter 13:

  • Burned: AMEX, Chase, Citi, Wells Fargo, and South County Bank (now Bank of Southern California)
  • Filed: 26-Feb-2015
  • MoC: 01-Mar-2015
  • 1st Payment (posted): 23-Mar-2015
  • Last Payment (posted): 07-Feb-2020
  • Discharged: 04-Mar-2020
  • Closed: 23-Jun-2020

 

I categorically refuse to do AZEO!

In the proverbial sock drawer:
Message 4 of 15
Zosimus
Regular Contributor

Re: Lender For Older Vehicle

Sadly, we've tried to install the Experian app but for some reason my son's phone isn't receiving the text message needed to get that app authorized and installed. We deal with MetroPCS. A year or two ago, there was massive flooding in Arizona, and we used to constantly get emergency messages warning of flash floods. Somehow my son turned all those emergency messages off, and I suspect that whatever he did may be the reason he isn't getting the messages.

 

At any rate, the local credit union has an "instant offers" page that lets you put in your details, does a soft pull, and offers you whatever fits within their underwriting model. I don't know which CRA they pull from but, as you said, it almost certainly isn't Vantage Scores. So, whatever FICO score they got tickled their fancy.

 

We thought we were in like Flynn, but the age of the car is a factor and the seller of the car (whom we haven't contacted directly yet) is a private seller so it's not like we're rolling up to a dealership that can offer us the 80 lenders they have in their portfolio.

 

The CU did offer us a personal loan, but only for $2,500. The $2,300 cash he has plus the $2,500 = $4,800 so you may think that's a done deal, but I'd like him to have enough to pay for the insurance on the vehicle.

 

Income is also a factor. He makes $15/hr but only gets on average 18 hours/week so that's maybe $1,170 a month. 


Message 5 of 15
Zosimus
Regular Contributor

Re: Lender For Older Vehicle

@Horseshoez Any specific lenders you could think of? I have a buddy who works for Cottonwood Auto Sales. Maybe I should just go ask him about lenders....


Message 6 of 15
Slabenstein
Valued Contributor

Re: Lender For Older Vehicle

Different lenders are going to have different limits on age (or lack thereof) for vehicle collateral, so, really, you'll want to check lender by lender with local credit unions, etc, to see what they want to do if you're set on a vehicle loan.  But, honestly, for a vehicle in that price range, a personal loan usually ends up being the way you want to go, since a vehicle loan would require full coverage insurance and the difference between that and liability-only on a beater is usually more than you'll spend on the difference in interest between auto and personal.  (And, in some cases, the rate on a personal loan will be better than the auto rate for a 10+ y.o. vehicle, anyway.)


Message 7 of 15
GZG
Valued Contributor

Re: Lender For Older Vehicle


@Zosimus wrote:

So, my 18-year-old son needs a car.

3tradeliness

AAoAA4y3mm

100% on time payment

1% utilization

AZEOO


your son needs his own tradelines, you can't just add AU's and have a credit profile. they should open a credit card in their name, discover IT/chase freedom rise being some good options

 

also, cars that old typically need 'classic' car financing and you can't typically just go for a 'normal' car loan 

 

 

Starting FICO 8:

Current FICO 8:

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2/6, 3/12, 11/24

Message 8 of 15
Horseshoez
Senior Contributor

Re: Lender For Older Vehicle

I just did a search for "financing for 20 year old car" and got lots of valid hits.

Chapter 13:

  • Burned: AMEX, Chase, Citi, Wells Fargo, and South County Bank (now Bank of Southern California)
  • Filed: 26-Feb-2015
  • MoC: 01-Mar-2015
  • 1st Payment (posted): 23-Mar-2015
  • Last Payment (posted): 07-Feb-2020
  • Discharged: 04-Mar-2020
  • Closed: 23-Jun-2020

 

I categorically refuse to do AZEO!

In the proverbial sock drawer:
Message 9 of 15
GreatLife
Regular Contributor

Re: Lender For Older Vehicle

Trying to think out the box..

Your son as an adult can perhaps obtain a small personal loan and pay cash for the vehicle, then at some point refinance to a better interest rate? 

Message 10 of 15
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