Should I apply for auto loan myself or with husband who has bankruptcy?

[JuleeM]

Hi. My husband and I are going to finance a new car this year and I'm trying to decide on how to apply for financing. We have been married 2 years so this is our first time making this sort of purchase together as a married couple and I'm not sure how to best do this, especially since he has a bankruptcy on his report.

Me
I have a high cc utilization ratio right now (56%) and a TU/EF (from Credit Karma) scores of 659/669. I will be able to get my utilization down to 30% by the time we apply for the loan. Credit Karma's simulator says that will make my score go up to about 710 (not sure how accurate that is). My debt to income will be about 31% at that point. Almost all of our cc debt, my student loans, and our mortgage is in my name. I have a prior auto loan with perfect payments that closed in 2003.

Husband
He had a bankruptcy in 2012. He has two credit cards at 38% utilization and TU/EF scores of 691 and 690. If we combine our incomes and debt the debt to income is about 21%. No prior auto loans show on his report. 

We are trying to qualify for 4% or lower. Would we be better to try to get the loan together so we show the higher income or should I just try on my own since he has a bankruptcy? If I apply on my own they only look at my income correct and not household?

[Anonymous]

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@JuleeM wrote:

Hi. My husband and I are going to finance a new car this year and I'm trying to decide on how to apply for financing. We have been married 2 years so this is our first time making this sort of purchase together as a married couple and I'm not sure how to best do this, especially since he has a bankruptcy on his report.

Me
I have a high cc utilization ratio right now (56%) and a TU/EF (from Credit Karma) scores of 659/669. I will be able to get my utilization down to 30% by the time we apply for the loan. Credit Karma's simulator says that will make my score go up to about 710 (not sure how accurate that is). My debt to income will be about 31% at that point. Almost all of our cc debt, my student loans, and our mortgage is in my name. I have a prior auto loan with perfect payments that closed in 2003.

Husband
He had a bankruptcy in 2012. He has two credit cards at 38% utilization and TU/EF scores of 691 and 690. If we combine our incomes and debt the debt to income is about 21%. No prior auto loans show on his report. 

We are trying to qualify for 4% or lower. Would we be better to try to get the loan together so we show the higher income or should I just try on my own since he has a bankruptcy? If I apply on my own they only look at my income correct and not household?

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His bankruptcy is old enough and his income and scores probably help far more than hurt so I would apply jointly.  I strongly suggest paying down the cards like your planing on doing, remember it takes some time for some card companies to report to the agencies so keep that in mind when you are ready to apply.  Also Credit Karma scores are pretty useless, especially when it comes to determining auto scores.  Finally I suggest joining DCU, Penfed, NFCU or really any good credit union and getting preapproved through them before you go shopping.  They are your best shot for good interest rates and having that preapproval in hand makes the entire process so much more enjoyable.    Let us know how it goes.  I am sure you will be fine.

[JuleeM]

I purchasd my Equifax score here last night and looks like I'm 727 and 740 Auto!

[Anonymous]

If your auto loan closed in 2003 it doesn't factor in your scores at all anymore.

Your best bet is a sizable down payment and a credit union. Some credit unions only have 1 rate for auto loans, so you're either approved at the ~2% rate that is common these days, or not approved, but at least you won't have to worry about being approved at a high rate.

[Anonymous]

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@JuleeM wrote:
I purchasd my Equifax score here last night and looks like I'm 727 and 740 Auto!

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With those scores your golden.  I would join one of the good credit unions , NFCU, Penfed or DCU apply and you are on your way.