Need to get out of it. Hope that you can help me!

[Anonymous]

Trying to get a new auto loan / lease.  Went through a rough 18 months in 2017 and 2018 where I had to take on substantially more debt than anticipated. Income is $175k.

Fico Score 8 (standard) is 704 EQ, 688 TU, and 664 EX.

100% payment history for 24 months. No charge offs. Some medical collections that are at least 24mo old, many of which are in legitimate dispute with bureus over the past few weeks due to insurance claims. DTI is ~30%. Credit card utilization on one account that I'm on Authorized User is 90%. All of my other revolving cards are equating to 5% utilization according to MyFico.  

Quite a few consumer finance personal loans (LendingClub, Mariner, etc.) totaling to $27k.

What are my changes of obtaining a car loan with Chase or a similar under 5%? New car, total financed would be close to $50k. I'm needing to roll in a little less than $10k of negative equity included in that total amount as prior loan was taken at a high interest rate to get additional cash for an emergency, which has now passed. That payment is almost $1k a month. If I can even get $200 less per month with a new $40k car, that helps me continue to pay off debt.

I'm wanting to get a new vehicle to avoid costly repairs which will be coming to mine and to downsize to a more fuel economical vehicle.

Would a "fire sale" lease be a better option? Where I could hide that negative equity in dealer rebates for EOY models? Or is financing due to my negative equity the best bet?

Thank you for helping!

[TheFIGuy]

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@Anonymous wrote:

Trying to get a new auto loan / lease.  Went through a rough 18 months in 2017 and 2018 where I had to take on substantially more debt than anticipated. Income is $175k.

Fico Score 8 (standard) is 704 EQ, 688 TU, and 664 EX.

100% payment history for 24 months. No charge offs. Some medical collections that are at least 24mo old, many of which are in legitimate dispute with bureus over the past few weeks due to insurance claims. DTI is ~30%. Credit card utilization on one account that I'm on Authorized User is 90%. All of my other revolving cards are equating to 5% utilization according to MyFico.  

Quite a few consumer finance personal loans (LendingClub, Mariner, etc.) totaling to under $15k.

What are my changes of obtaining a car loan with Chase or a similar under 5%? New car, total financed would be close to $50k. I'm needing to roll in a little less than $10k of negative equity as prior loan was taken at a high interest rate to get additional cash for an emergency, which has now passed. I'm wanting to get a new vehicle to avoid costly repairs which will be coming to mine and to downsize to a more fuel economical vehicle.

Would a "fire sale" lease be a better option? Where I could hide that negative equity in dealer rebates for EOY models? Or is financing due to my negative equity the best bet?

Thank you for helping!

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Are you apart of any CU's? If so, I would try them first before hitting up "lending tree" etc.

NFCU — If you qualify is GREAT

PenFed — Good

DCU — Great

I'm sure others will chime in with other CU's that might be helpful.

[Anonymous]

Thanks!

The car that I'm looking at is running a promo of 1.9% financing through Subaru Motors (Chase Auto), though I'm trying to see if I would qualify based on those scores?

[TheFIGuy]

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@Anonymous wrote:

Thanks!

The car that I'm looking at is running a promo of 1.9% financing through Subaru Motors (Chase Auto), though I'm trying to see if I would qualify based on those scores?

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Subaru Motors is tricky as they exclusively work with (Chase Auto). IDK if you would get 1.9% with the above scores but possibly financed at the very least. Then in 1 year you could re-finance with a CU for a better rate  

[Anonymous]

It will be hard for them to hid 10K in negative equity in a Subaru and I doubt you will get a promotional rate with your scores and with that negative equity.  I am not a fan of rolling in negative equity into new loans because it compounds your financial problems.  I have done it twice and decided never again but that is my personal decision and we all have to make our own.  Your best shot to roll that amount of negative equity is going to be a vehicle with a large rebate and or large discounts.  I would get a preapproval from a credit union for sure, this will help keep the folks at the dealership honest as often when folks are against the wall with negative equity an/or tough credit they mark up the interest on the loans they put together.  Dealers no longer make any real profit on new cars sales, they make their money in the finance office on financing, protection plans etc as well as on used car sales.  Knowing that you want to minimize their oppourtunities which can save you thousands.