To pay or not to pay...

Mutt · ‎03-01-2014

I had a repo in 2009 with Santander and the account has an outstanding balance of $2097. The account is slated to drop 10/2016 and if my car didn't need more work than it is worth I would wait until the account dropped. I'm not sure which action would result in the best rate, pay off the outstanding balance or use the money to increase my down payment? Also when I ran my Experian report the account's payment history shows "KD" key derogatory every month (including Feb 2014) since 2010 even though the account was closed in 3/2010. Lastly, when I went to use the pay off outstanding debt simulator it stated I had no outstanding debt?

TU 775, EXP 668, EQ 678

RushXTC · ‎03-01-2014

Don't pay it, It's not like it's your responsibility to pay off any debt you create.

/sarcasm

Creditaddict · ‎03-01-2014

@RushXTC wrote:
Don't pay it, It's not like it's your responsibility to pay off any debt you create.

/sarcasm

HELPFUL

/sarcasm x2!

OP, is it not on your TU since I see that is very high? have you thought about an Infiniti? They pulled TU for me and for some reason had a higher then any Fico, regular or auto enhanced I had seen up to that point and was working with Lexus, Acura, and Kia before them at same time.

I was tier 1 at a 668 (well tier 2 they said but bumped me to tier 1 before even talking to me)

Remember0 · ‎03-02-2014

I wouldn't pay...turning that into a paid account won't really raise your FICO. Maybe it'll look better on manual review, but meh, I doubt even that. Biggest question: Is that debt past the statue of limitations in your state? If not, don't wake a sleeping bear. Lay low and let it pass imo so they don't sue. Them suing and getting a judgment would be terrible credit-wise. Also putting ANY payment towards it resets the SOL...another bad thing.

If you are 100% (no, make that 200%) sure it is past the statue, maybe you can lok into negotiating a pay for deletion that you get in writing with the lender before sending them a cent. With a PFD that's in writing, it would obviously raise FICO and you'd qualify for top tier rates. But you'd better be 100% sure this is past SOL or else this method of tackling it won't end up pretty.

Honestly, I think the best rate would come from saving the money for a down payment. Actually, save the money for a down payment, and find a lender that uses tu historically. I'd look for tu-biased CUs that reliably pull TU...anyone have any that come to mind?

Mutt · ‎03-02-2014

Oops, just realized that TU score is from TU's website. Tried to run it here but no luck, authentication error.

Thursday my car was throwning a knock sensor code which I fixed on Friday. Yesterday the car threw a code for a cylinder misfire and later that day I notice a medium sized puddle of antifreeze underneath as I backed out of the driveway. The timing belt and waterpump should have been replaced 10,000 miles ago (per the manual) at the cost of $1200 (engine has to pulled to perform). I'm trying to limp along, avoid high maintenance cost, until the company I work for pays out the yearly bonus in April.

Do I pay the day debt now which timing would be about equal (Bonus pays 4/15 - Santander has 45 days to update) and risk the car blowing up? This would leave me with a small downpayment and the same scores I have today, which I wonder how bad that Santander account is hurting my chances to even get a loan. Second option, don't pay it now, trade in/donate/scrap the car while its still somewhat driveable, take my chances at getting a loan with my current scores and hope a higher downpayment helps me get a loan.

Rush, I won't go into the long drawn out story of my ex-wife's spending habits resulting in my crappy financial situation or the nasty, costly divorce as a result... in the end the debt is mine regardless of what court documents say.

I'll check into the SOL Remember and the sleeping bear has definitely been weighing heavily on my mind.

Remember0 · ‎03-02-2014

@Mutt wrote:
Do I pay the day debt now which timing would be about equal (Bonus pays 4/15 - Santander has 45 days to update) and risk the car blowing up? This would leave me with a small downpayment and the same scores I have today, which I wonder how bad that Santander account is hurting my chances to even get a loan. Second option, don't pay it now, trade in/donate/scrap the car while its still somewhat driveable, take my chances at getting a loan with my current scores and hope a higher downpayment helps me get a loan.

I stand by what I said above. I would NOT pay. Having it as a DP will help you MUCH more than getting that Santander to reflect as paid.

Is the Santander account reflecting on TU? Score doesn't matter, is the account there and showing the repo/deficiency?

Also if you buy a car, the details of the story may help the finance manager get you financed esp. if divorce paperwork says it's not your debt or she was responsible after the divorce. But don't tell them about the bad credit till AFTER you negotiaite a price (preferable in writing by email).

Also think about applying to a CU like DCU. I think DCU may use EQ non-auto enhanced and with a 678 EQ, you may qualify for 1.99% if they overlook the baddie esp. since it's 5 years ago...I think it's worth the one inquiry to be honest. Even if the EQ they pull is lower, their next tier is like 5.25% which is still pretty good as a backup if the dealer can't get you a better rate (most likely the dealer will get you <4% as long as you make him compete by having another offer imo).

Mutt · ‎03-02-2014

Thanks for your input Remember, greatly appreciated!

FWIW, the divorce decreee does state she was responsible. As far as my credit, I have two other collections that have a zero balance stemming from the same time period. Mortgage history is all good up until the months leading up to the divorce, almost lost the house, but has been paid on time since the divorce. The most recent change is a Cap One credit card that I opened alittle over two years that started with a limit of $500 and is now up to $2,250.

Remember0 · ‎03-02-2014

Gotcha. But do all of these baddies report on all three reports? In other words, is there one bureau which is missing some (or all) of these baddies?

Mutt · ‎03-02-2014

All three are reporting differently:

Equifax lists hsbc auto, hsbc/Scusa, Santander...all for the same auto/repo account, 1 collection, mortgage late pays.

Experian lists hsbc auto, Santander...same auto/repo account, same collection as EQ, mortgage late pays

TU lists hsbc auto, Santander......same auto/repo account, same collection as others + a different collection that drops 7/2014, mortgage late pays.

Remember0 · ‎03-02-2014

Gotcha. Then your scores are going to be pretty uniform across the bureaus. and the FICOs you pulled (assuming from here) for EX and EQ are pretty much going to be what TU is. So don't bother paying for your TU score imo.

Since you appear to still have a 670+ though, I think the one local CU/bank or DCU application would be worthwhile.

Also, if it's past SOL, you could try disputing those duplicated accounts as illegally (per FCRA) duplicated accounts. I don't think they are allowed to report the same discrepancy thrice as different accounts, but it happened to a lot of people due to a merger/them buying loans. I'm not an expert on disputes though, maybe someone else can chime in. If it's not past SOL though, I would not even dispute them. But that's just my personal take, as I said I'm not an expert on disputes so somebody will correct me/maybe has better advice in this department for you.