Looking for Opinions

[Anonymous]

I am looking at purchasing an 09' Mazdaspeed3, $25,325. Score currently is 563. Two collections (Sprint, hospital) under $400 combined. Two credit cards paid monthly on time (Cap One and Zales). I plan on putting 8k down with no co-signer. I am looking for angles here on possibly being approved, factors which may hender approval, etc. Constructive crit welcomed. Also I keep getting this pre-approval thing from Cap One, just as I did with there credit card. Should I cave in and give it a go? Thanks in advance.

Message Edited by iamscape on 03-18-2009 04:38 AM

[llecs]

Welcome to the forums!

If I was in that situation, I would take a thousand or two and buy a clunker instead. Something temporary. Then I would focus on repair and take steps to get rid of the baddies on your report ( read What Steps Do I Take  for great repair advice ). After my scores reached at least 650 (you could easily do that with 2-3 months of effort), then I would re-evaluate and consider buying that car if it were within my budget, etc. Doing this will save you thousands of dollars in interest because instead of being stuck with a 15%-20%+ rate, you'll be a lot lower rate and probably wouldn't need to fork over a $8k down payment.

[moondog7324]

1. How old are the collections?

2. What is the utilization on your cards? Do you pay in full everymonth- or just the past due?

I'm thinking the 8Gs would be better served paying off the collections- if they would PFD, and paying down your credit cards to <10%. I'm not sure if the paid off collections will lower or raise or lower your score- but getting util <10% definitely will help.

What else is on your credit report? I think you can raise that score to mid 600's in a few months.

As far as the Crap 1 pre-approval: what is the interest rate?  Use a loan calculator to figure out what financing $17,000 would be. Good source of info www.edmunds.com

I

Message Edited by moondog7324 on 03-18-2009 07:50 AM

[moondog7324]

The starting MSRP for a 2009 Mazda3 is 14,690- and you want to buy one for 25,325? So basically your putting $11,000 of junk (options) on a $14,000 car. I want to be that salesman- make sure you get the extended warranty, undercoating and the special wax.

[Anonymous]

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@moondog7324 wrote:

The starting MSRP for a 2009 Mazda3 is 14,690- and you want to buy one for 25,325? So basically your putting $11,000 of junk (options) on a $14,000 car.

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Thats base for a base trim level in the Mazda 3. if you want any other level the base is closer to 20,000.  Add a automatic transamission and few other things and you are in excess of 23,000.

Thats like saying the base price for a F-150 is XXXX why are you paying 35,000, well that base price is for a 2 door manual without air conditioning, non 4x4 and the price of the one you want is a super cab, 4x4.

I personally think that the OP is buying way too much car for the credit score/capacity he has, and should stick below a 20,000 total transaction before the down payment.

25,325*.07= 1772, add $500 in fees and transaction costs and even with 8K down you are at 20k financed.

You are going to pay a huge penalty interet rate for your spotty credit. With the downpayment, Your payment is probably going to be in excess of $450-$500 a month at 6 years, not counting car insurance. Assuming you are buying the model an insurance company will classify as a sports car your insurance will be in excess of 200 a month. Putting gas in the car is going to put you around 750-800 a month in car obligation for the next 5-6 years.

The interest rate you get will cause you to be in a huge negative equity situation, the payment will cause you to hate the car. If you try to trade out 4 years after you buy, you will carry thousands of dollars of negative to a new car carrying on the cycle.

Message Edited by usmc58555 on 03-18-2009 08:57 AM

[Anonymous]

Thank you for all your replies and view points. Moondog7324, I can understand your view as far as being insane buying a Mazda 3 with a turbo engine it for that price but eh it is simply put the best of both worlds. I only have 383.xx in collections. I am a first time car buyer as well so I am looking on the up and up here. usmc5855, thank you for your extensive reply as well. I have done some reasearch regarding my insurance, which shockingly is lower than what I thought it would be, 99 bucks a month. I feel the main reason my credit is not so "awesome" nor "good" is because I have no credit when it comes down to it. Just two credit cards. I do not have a co-signer because the people who will are in no position to even attempt trying to do anything with even $2000 down and them as a potential co-signer. Instant no I am sure. IIecs, a clunker... I have had too many of those and I do not want to deal with the heartaches that come with them. Right now I just feel I am stuck in a rock and a hard place because I do not want to get owned too hard on financing.

[Anonymous]

lam, I'm kind of in the same boat as you, looking at buying a car, but not the best scores.  I'm waiting to bring up my scores, and already in less than two months, reading the posts here and taking advice to heart, paying down debt, disputing errors on my reports, I've gained 49pts on my TU and 34 pts on my EQ, and I'm not even done repairing.  My first goal was to get to 650, now my goal, before buying a car is 700, because I know it can be done.  I'm driving a Saturn that's almost eight years old and completely paid for, over 100 miles a day to work and back, and even if it's not the most stylish or powerful car out there, it'll do till my scores get to a good place, and till I can put about 8000 down on my dream car.  I got one of those things from Cap1 but I'm just going to wait, because I know if I just wait a little longer, I can save thousands on interest.  I wouldn't cave in, I know it's tempting, but I would wait a bit that way you have more options when it comes to financing.

[Anonymous]

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thank you for your extensive reply as well. I have done some reasearch regarding my insurance, which shockingly is lower than what I thought it would be, 99 bucks a month.

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Did your research involve actually talking to an agent, or just online quotes?

There is a huge (and I hate using this phrase as I feel it is overused) "Bait and Switch" out there where you do the online quote, you give them your SSN, you list your violations, you give them your DL number and they STILL give you initially the best possible worlds rate, you sign up then a few days/week later you get an amendment paperwork that is much higher then your online quote that actually takes all the factors you freaking gave them in the beginning into account.

Progressive and USAA are the only 2 companies I know that the online quote was my real quote/payment.

Please be aware of that.

There is a lot to be said for going into a new car from a clunker. Just having the warranty and knowing it will start when you turn the key is a huge sense of satisfaction.