Which is better?

[Purplex]

Hello all!  This is my first time posting, although I've read some and think this forum is just wonderful, as is everyone who takes the time to help others to raise their credit score!

I hope that someone can give some advice for a dilemma I have.  I applied for auto loans (all within 2 weeks) a few weeks ago and was approved, with some hassle, for a used car loan of $5,000 for 27 months. After all the hassle of getting it (my mortgage company apparently doesn't report to the credit bureaus!) I was just glad to get the loan finally over with so I didn't look to see what the interest rate was.  After looking at the paperwork I see that it is 29%!!!! Yikes!

So, about a week after I signed the loan paperwork for the used car (which I do really like), I found out I was approved for Ford Motor Credit for 8.9% on a new car.  My question is which would look better on my credit report, to have a "finance company" type auto loan (sub-prime type lender) for $5,000 or Ford Motor Credit for $18,000?  My concern is I may have to get about a $2,000 general loan to pay a tax bill in April and want to have the best score I can for that.

Thanks for any opinion anyone would like to give.  Also thanks again for everyone who contributes to this forum.

Joy

[fused]

Welcome to the forums! FICO scoring wise, a "consumer finance loan" is not looked upon favorably. It's better not to have them on your reports. That said, don't expect to lose a lot of points by having one of these types of loans on your credit report. You might lose a few points, that's all.

[Purplex]

Thank you, that's good to know. I'm just wondering if the difference bettween having a loan for $5,000 compared to a loan for $20,000 will make a huge difference.  I'm glad that the finance company issue won't make that big a difference, though, that was really worrying me.

[Zahnrosen]

The cost of 29% interest is so high I wouldn't worry so much about your scores. They might drop slightly but overall you'll be much better off with the Ford loan on a car I think you'd probably be happier with. 29% is really rough.