Will I qualify for a refi?

[Anonymous]

Credit Score:

eq 657 ex 647 TU 660

Fico Auto 08 625

AAoA: 3.6 years

# of positive trade lines: unknown. I have 5 paid off auto loans, 8 paid off credit cards, a dozen or so student loans that are currently totalling $90k

# of negative trade lines: I have 2 paid collection accounts as recent as 2014

Income: $80k

Lenght of Employment: 3 years

Previous Loan Experience: 4 Paid off Motorcycles, all with Harley Davidson Financial (3 cosigner)

                                           1 Paid off automobile with Honda Financial

                                           4 open auto loans, including this one I want to refi, one I am a cosigner 

                                           $15k with Honda Financial, $25k with Captial 1

Debt-to-Income (DTI): 39%

Barclay $31/$1800/$2000

Capital 1 $26/$2300/$2500

Jared $120/$1547/$1900

Target AU $66/$1361/$3000

Capital 1 AU $25/$1847//$3500

Honda Financial $410/$15k

Capital 1 Auto $550/$25k

Capital Chrysler $798/$36k (wanting to refi)

Harley Davidson Financial $406/$7000 Cosigner

Navient $478/$76k

AES Student Loan $130/$14k

Year of Car: 2017 Jeep Wrangler Sport Unlimited

financed $36k with Chrysler Capital, I'm 6 months into this loan and considering refinancing bc the finance guy advised us to do so after 6 months. If this is not even feasible, let me know so I can learn how to be patient.

Miles:3k

Purchase/Refinance: refinance

Requested loan term (XX Months): unsure

Down payment amount: $0

Co-borrower/Co-Signer: no

[Appleman]

I will take a shot at a few things here for you.

Sign up for Credit Sesame (only the free version) this will give you an idea about your DTI according to your credit reports.

I would also recommend that you sign up for the $1 trial of Credit Check total. Be sure to cancel within the 1 week to not be billed more than the $1. This will give you accurate FICO08 scores.

Go to KBB.com and Cargurus.com to see how much your Jeep is currently worth. Some places may loan you up to 120% of book value, the value will be key in how much they can loan you.

UTI: Pay Barlclay down below $1,400 to get utilization down below 70%. Pay Cap1 down to below $1,680 to get below 70% utilization.

(Other personal milestones where I have seen score improvements were below 50%, 30% and 10%. As you pay each card down below this utilization percentages you should also see a FICO increase.

Good luck....

[Anonymous]

Appleman: Sign up for Credit Sesame (only the free version) this will give you an idea about your DTI according to your credit reports.

Thank you for that suggestion. It gave me a formula, monthly payments/monthly income, However it had me at 39%. 

UTI: Pay Barlclay down below $1,400 to get utilization down below 70%. Pay Cap1 down to below $1,680 to get below 70% utilization.

(Other personal milestones where I have seen score improvements were below 50%, 30% and 10%. As you pay each card down below this utilization percentages you should also see a FICO increase.

What did you calculate my DTI at? Maybe I am doing it wrong. Before paying off the credit cards, I was at 50% according to Credit Sesame formula.

[Anonymous]

Bump.

[Appleman]

Hello,

According to what you have posted, calculate your DTI with the following:

Income $80,000 / 12 months = $6,667 monthly income

Payments $31, $26, $120, $66, $25, $410, $550, $798, $406, $478, $130 = $3,040 minimum payments (Credit Sesame will pull them from what is reported on your credit report and this will often lag the most current report. However, this is the number the lender is likely to see)

$3,040 / $6,667 = DTI of .45 or 45% without adding anything in for housing.

My guess is that the majority of you score suppresion is from the near maxxed out credit cards. Getting those paid down should help, along with time as the paid collections eventually go away. As the scores climb the ability to score a refinance increase,

I would highly recommend trying YNAB (You need a Budget). It takes some effort to learn this budget system but it can help prevent you from creating new debt. It will not be easy but you have the ability to greating improve your financial picture. I know as it worked for me.

Good luck, and I hope that answers your questions.

[Anonymous]

Generally the single biggest factor in refinancing is the loan to value ratio.  If you didn't put anything down it is fairly likely that the depreciation combined with the transaction costs might put you too far upside down to get refinanced.  I would find the payoff amount and the fair market value and see how close they are.  For the best rates Penfed, NFCU, Alliant and DCU are the go to credit unions, of course most local credit unions are pretty good also.  Your DTI ratio is pretty tight but I think you can get it done if the LTV ratio is good.  Dealers often times will tell customers they can refinance in 6 months because they want them to sign on to higher interest so they can make their money on the finance end, unfortunately we see this happen a lot here.  Hopefully you can get this one done.  What is your current rate?

[Anonymous]

Appleman-thank you for the very heplful information. I can pay down those two cards to the suggested limits before I refi, that's not a problem. Reading through the posts again, I think I got Utilization confused with DTI. that is my mistake. I am still very new to all this. 

workingfor850- I looked up my vehicle at kbb.com and it is wihtin $300 of payoff amount. My current rate is 18%. 

[dabrian]

With a rate of 18 percent I would try to refi today if possible, however you would see a nice increase in scores by lowering your utilization on your credit cards.

[Anonymous]

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@Anonymous wrote:

Appleman-thank you for the very heplful information. I can pay down those two cards to the suggested limits before I refi, that's not a problem. Reading through the posts again, I think I got Utilization confused with DTI. that is my mistake. I am still very new to all this. 

workingfor850- I looked up my vehicle at kbb.com and it is wihtin $300 of payoff amount. My current rate is 18%. 

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At 18% you have a huge incentive to refinance so I would make that a priority.   Penfed and DCU are both excellent, if you can get in NFCU is also great.  I would join one asap (I am partial to Penfed) and do the refi as soon as reasonable.  It will save you many thousands of dollars.  BTW your dealer definitely marked up your MSRP.  My guess is your refi will put you around 4% or a little less.   Once you get in with a good credit union you will be able to get preapprovals before you shop next time which keeps the dealers games in check big time.  

[Anonymous]

dabrian- I want to refi as soon as possbile. I am waiting for a few more balances to report then I'm doing it. SO and I cosigned with each other, not for each other and his scores were 550-580, now finally got his to 612. Mine is where its at in the initial post.

 workingfor850- I have made refi a huge priority. I genuinely thought the finance guy was being sincere with us when he advised us to refi in 6 months. Our scores were pretty horrible when we bought the thing. I've spend the last 5 months improving them, paying off balances and not taking out any other credit.

Are Penfed, DCU and NFCU in Texas? I have never even heard of them? Texell just opened up a block away from me, and RBFCU is always advertsiting super low rates, like 0.9%. I think those two are Texas based.