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Loan Inquiries

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Loan Inquiries

Hey there -- I am going to try to keep this really long story short for you.

Long story short, my sister and I swapped cars before she moved out (I had a nearly paid off vehicle, or at least one that wasnt going to be so hard to refinance into my name) because my parents said that it would be smart -- I was told her car was a 2015 and more reliable than my 2013. I was also informed that both vehicles had some payoff left on them, but they didn't mention hw much compared to the worth. Being younger at the time, I was young and naive, and made the swap. Now, my parents have sold what was my car, and she is not in need of a vehicle.

Come to find out, her car (now mine) is actually a 2014, and the payoff is $10,000 but the value is only 5-6K (2014 Hyndai Accent). This in itself is making it nearly impossible to refinance, as every bank has told me that:

 

* they do not handle person-to-person transfers
* the value amount is too far below the minimum amount they can refinance a vehicle for (I usually get told that this minimum refinance amount is $7,500)

* I do not have enough credit history to receive a loan

 

However, I am running into more issues as well -- I don't have the best credit score myself. I have a few retail cards, and I only have two credit cards. One is a Barclay Visa that I had to purchase a laptop for school with 6 months ago (the card was opened 6 months ago), and still has a high balance on it. The other is a CareCredit that I have barely used ($200 out of $5500 or something similar...it is just the deposit for some health related things I need done). Because of this and $15,000 in student loans, my credit scores are an average of 580 which is AWFUL. They used to be so much higher but shopping around so much for ways to fix my problem have really brought it down -- my credit score was in the high 600's two weeks ago.

 

I don't know what my options are to get out of this underwater loan. I have to have the car in my name in a week and I am at a loss. My dad is going to co-sign with me but at this point I am stressed out that this will not be enough (he has a fantastic credit score, though). Can you help me think of ideas to get out of this mess quickly?

 

Thanks.

Message 1 of 6
5 REPLIES 5
Community Leader
Super Contributor

Re: Loan Inquiries

Just be upfront and tell your parents you don’t have the credit or funds to refinance the car.

 

Tell them you don’t want to refinance a $10K car that has only a $4-5K value. 

 

Why not give sis her car back and ask them to help you with financing another car?

 

Getting yourself in more debt is not the answer. You will only be more stressed out. 

 

Does your father know if he co-signs and you default, he is whom the lender is coming after. 

 

GL2U

 

 

 

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Message 2 of 6
New Member

Re: Loan Inquiries

I have been up front with them, and told them that I do not have the means to do so. They said they understood, but that it needed to be in my name.

 

They know I don't *want* to, but my sister can't take her car back (she is military & shipped off, can't use the car anyways), so they said I am either stuck with it or left with options to get a new car.

 

I know more debt won't help my stress, but I don't know what else to do. My fiance with better credit than myself is getting the loan and using it to get me on my feet somewhat, if he has to. We are scouting options, which is why I am here. 

 

What does it mean to "default"? He understands credit well so I am sure he understands this -- however, all I have ever done is tried to please my parents. I will not leave them with the car and it's respective payments, if that is what you mean.

Message 3 of 6
Community Leader
Super Contributor

Re: Loan Inquiries


@cmontoya wrote:

I have been up front with them, and told them that I do not have the means to do so. They said they understood, but that it needed to be in my name.

 

They know I don't *want* to, but my sister can't take her car back (she is military & shipped off, can't use the car anyways), so they said I am either stuck with it or left with options to get a new car.

 

I know more debt won't help my stress, but I don't know what else to do. My fiance with better credit than myself is getting the loan and using it to get me on my feet somewhat, if he has to. We are scouting options, which is why I am here. 

 

What does it mean to "default"? He understands credit well so I am sure he understands this -- however, all I have ever done is tried to please my parents. I will not leave them with the car and it's respective payments, if that is what you mean.


I don’t mean you would deliberately default. I’m only saying you can get in over your head with refinancing a

car that is not worth the money, and you’re already in a bad position with low scores. 

 

If you have the income to pay a carnote, and your father will co-sign, then you could purchase a newer car and roll the payment of the Kia into it but that’s going to make a pretty sizable monthly payment. But if approved, at least the Kia is sold and out of your name. 

REVISED GOAL: Garden ‘til Dec 2020 — 0 inquiries

Previous Goal: Garden til APR 2020 (extended) and
800 Club (accomplished)


DEC 2019: EX 816, TU 820, EQ 810
DEC 2018: EX 777, TU 783, EQ 799
DEC 2017: EX 775, TU 778, EQ 769

|| NFCU CashRewards $30K || AmX Cash Magnet $30K || Discover IT $22.2K || Macy's $20K || NFCU CLOC $15K || NFCU Platinum $12.5K || AmX ED $11.5K || CitiCostco $7K || CitiDC $6.3K ||
Message 4 of 6
Regular Contributor

Re: Loan Inquiries

Tell your parents that you don't want to do it for the reasons you've said: The LTV is too high and your credit is sub-par. Also, did they pay for your car or did you? Either way, if your dad has a "fantastic" score, have him Refi it in HIS name and you make payments. Put it in writing that it will be your vehicle at the end if you're paying for it and make all payments out of your bank account. If your dad has great credit, have him do a no secured interest loan (Check lightstream.com) and that way he can give you the title while doing payments on the vehicle. Also, buy GAP insurance as a ONE TIME purchase from a credit union or insurer separate from the one that insures your vehicle, it's cheaper. On that car it should be a couple of hundred dollars. Good luck.


@cmontoya wrote:

Hey there -- I am going to try to keep this really long story short for you.

Long story short, my sister and I swapped cars before she moved out (I had a nearly paid off vehicle, or at least one that wasnt going to be so hard to refinance into my name) because my parents said that it would be smart -- I was told her car was a 2015 and more reliable than my 2013. I was also informed that both vehicles had some payoff left on them, but they didn't mention hw much compared to the worth. Being younger at the time, I was young and naive, and made the swap. Now, my parents have sold what was my car, and she is not in need of a vehicle.

Come to find out, her car (now mine) is actually a 2014, and the payoff is $10,000 but the value is only 5-6K (2014 Hyndai Accent). This in itself is making it nearly impossible to refinance, as every bank has told me that:

 

* they do not handle person-to-person transfers
* the value amount is too far below the minimum amount they can refinance a vehicle for (I usually get told that this minimum refinance amount is $7,500)

* I do not have enough credit history to receive a loan

 

However, I am running into more issues as well -- I don't have the best credit score myself. I have a few retail cards, and I only have two credit cards. One is a Barclay Visa that I had to purchase a laptop for school with 6 months ago (the card was opened 6 months ago), and still has a high balance on it. The other is a CareCredit that I have barely used ($200 out of $5500 or something similar...it is just the deposit for some health related things I need done). Because of this and $15,000 in student loans, my credit scores are an average of 580 which is AWFUL. They used to be so much higher but shopping around so much for ways to fix my problem have really brought it down -- my credit score was in the high 600's two weeks ago.

 

I don't know what my options are to get out of this underwater loan. I have to have the car in my name in a week and I am at a loss. My dad is going to co-sign with me but at this point I am stressed out that this will not be enough (he has a fantastic credit score, though). Can you help me think of ideas to get out of this mess quickly?

 

Thanks.


 

Message 5 of 6
Regular Contributor

Re: Loan Inquiries


@cmontoya wrote:

I have been up front with them, and told them that I do not have the means to do so. They said they understood, but that it needed to be in my name.

 

They know I don't *want* to, but my sister can't take her car back (she is military & shipped off, can't use the car anyways), so they said I am either stuck with it or left with options to get a new car.

 

I know more debt won't help my stress, but I don't know what else to do. My fiance with better credit than myself is getting the loan and using it to get me on my feet somewhat, if he has to. We are scouting options, which is why I am here. 

 

What does it mean to "default"? He understands credit well so I am sure he understands this -- however, all I have ever done is tried to please my parents. I will not leave them with the car and it's respective payments, if that is what you mean.


So clearly I initially responded without reading that your dad won't put it in his name, but whose name is it in now? At the end of the day, if you're declined, you're declined. DO NOT ASK YOUR FIANCE TO COSIGN THIS TRAINWRECK. If your parents paid for your car initially, you didn't "own" it so they did what they felt they needed to do. However, they can't force you to put this car in your name. All you have to do is say, "I'm sorry, I cannot get it financed in my name." If your dad doesn't want to help you refinance it, it's likely his credit isn't as good as he wants you to think. Your best option will be continuing to just pay the note. If it's currently financed at a high rate, refinancing it won't help because it will add fees. If it's at a low rate, it's likely better than what you can get. I'm sorry this information likely isn't what you want to hear.

Message 6 of 6
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