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.
3 tradelines
AAoA 4y3m
100% on time payment
1% utilization
AZEO
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.
@Zosimus, shop around, there are plenty of credit unions (and probably banks as well) who will finance a car that old.
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.
@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....
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.)
@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
I just did a search for "financing for 20 year old car" and got lots of valid hits.
