Need to buy $45k car by November

[Anonymous]

I was recently in an accident where my car was totaled. My pay off on the car was 43k which went entirely to the loan as I have only had the car a few months. I typically have a Fico of 730 or so but due to the purchase of this car a few months ago and some medical bills this summer that went on a few cards, my scores are all currently sitting around 650. I was declined from the bank I used last time (LightStream), from BOA and CapOne (Through their dealer network which is gross) has only offered up to 35k. My Sales Tax Affidavit being for 43k means that I would be leaving "money on the table" with any car under 43k as I would lose the difference in my sales tax credit. I also need to do all of this within 30 days of the affidavit (Oct 2). I make 120k/year, live frugally and never have a had a hard time with my auto payments, so I am not concerned about a similar monthly payment.

The Questions are:

As I drive a lot (30k mi/yr), and my last car was a Tesla I would like to go back to one as it was both comfortable and cost effective. If I apply for financing through Tesla or anywhere else for that matter... Should I apply for the car I want 45k? What happens if I am denied in that situation? Can I re apply for a less expensive car through Tesla? I don't want a million hard pulls on my CR as each one will make the whole thing more difficult. My wife's auto loan (16k) is under my name as well. I can afford 3-5k as a down payment in this time frame.

Any help would be appreciated!

Also as of this morning my Fico Auto dropped 88 points from what it was last week down to 578. The only thing that has changed is that I paid of about 5k in debt and I applied for a BOA loan which I was not approved for. This is aggravating.

[Anonymous]

Something doesn't add up as to why your scores are so low. Is your CC utilization through the roof OR do you have late payments or other derogs?

I wouldn't focus too much on spending the $45k as to not lose anything on the tax credit. If you need to do this while your credit is less than stellar, you will quickly offset any of the recouped tax credits in paying higher interest on an expensive car.

When you get an approval, do the math on the amount you'll pay in interest at the rate they give you VS the amount of interest you'd pay if you were to get a prime rate, THEN offset that difference against the tax credit you would miss out on if you were to say buy a $20k car. The results could be surprising here . . . 

If you can't get your scores up before this needs to happen, I would recommend buying a moderately priced car and getting back into a Tesla sometime down the road when you are in a better situation.

Affording the payment or not, your financial situation is in fact strained to be carrying medical debt on CCs and having score issues.

[Anonymous]

CC util went from 28% to 66%. Its back to 49% right now and theres a big chunk of that that not reflected on my CR yet. This will get util into the 30s. I really only put it on CCs in the first place to take advantage of cash back and 0% int.

I have 7 derogs from missed payments while I lived overseas. I was geo blocked and hadnt yet discovered VPNs.  I have talked to a couple of my banks and they seem willing to remove these once I provide proof, but I doubt that this will show up prior to Nov 1st. 

I am fine buying at a higher interest rate and doing a Refi a few months in. That will lose me dramitically less that the $4300.00 sales tax credit that I am losing any other way. As if today my Fico 8 is 656 and rising. My original question still stands though. If I apply for financing through tesla or anyone else should I start low for the sake of getting approved and ask for more once I am approved, or ask for the full ammount and dial it back if I am not approved?

[randomguy1]

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@Anonymous wrote:

CC util went from 28% to 66%. Its back to 49% right now and theres a big chunk of that that not reflected on my CR yet. This will get util into the 30s. I really only put it on CCs in the first place to take advantage of cash back and 0% int.

I have 7 derogs from missed payments while I lived overseas. I was geo blocked and hadnt yet discovered VPNs.  I have talked to a couple of my banks and they seem willing to remove these once I provide proof, but I doubt that this will show up prior to Nov 1st. 

I am fine buying at a higher interest rate and doing a Refi a few months in. That will lose me dramitically less that the $4300.00 sales tax credit that I am losing any other way. As if today my Fico 8 is 656 and rising. My original question still stands though. If I apply for financing through tesla or anyone else should I start low for the sake of getting approved and ask for more once I am approved, or ask for the full ammount and dial it back if I am not approved?

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Tesla financing is looking for your FICO score to be above the minimum 650 requirement. Any delinquent credit, charge-offs, and late payments reporting to the your credit file will also be factors. Your best bet is to a higher score is to pay down your utilization below 9% before applying for auto financing. In the 30s will help but under 9% will be better. 

Your best bet as suggested earlier, is to join a credit union and apply for a loan. Alliant and DCU are popular options. You might want to check your local ones as well. Be aware, some credit unions will be hard pulls to join (Alliant won't) but it will be a hard pull for the auto loan. Some may use an additional pull, you will need to verify with the CU.

[Anonymous]

Thanks for that. I use a CU for my biz banking but their auto rates are **bleep**e. They're mostly a biz cu and straight up told me to look elsewhere. I'll check with Alliant once my current pay downs show up on my report. 

[randomguy1]

What state are you in?

[Anonymous]

Missouri

[Anonymous]

your math is definitely off...your savings on sales tax is no where near what you would owe on a more expensive car..you can easily buy a cheap car and pay no tax and be ahead...