Question about car loan

Anonymous · ‎10-15-2019

Hey guys, my credit profile consists of 3 secured cards, and an SSL, all of which were opened last month. I'll be implementing the AZEO method every month. I have 4 baddies, 3 of which will be deleted by the end of next month. As for the 4th, it is still updating, and I just wanted to know that when I pay that one in full, can I expect it to help my point situation in the short term? Short term being like 4~5 months. Because I'll be trying to get a loan for a car in March. My AAoA will be super low once the 3 baddies get deleted, because I have these new cards and the one remaining baddie only, which is 5 years old at this point.

Any data points on rates I can expect? I'm looking at about a $19,000 used 2017 car, with $3,500 down.

FireMedic1 · ‎10-16-2019

Are you talking collections or credit accounts? List your baddies please. Do you know your FICO scores. Need more info. Welcome to the forums.

Anonymous · ‎10-16-2019

@FireMedic1 wrote:
Are you talking collections or credit accounts? List your baddies please. Do you know your FICO scores. Need more info. Welcome to the forums.

My fico scores are in my signature~ The collections that are being deleted are just collections, no credit accounts.

The remaning baddie is a Credit one charge off by LVNV funding, for $507. DOFD May 2015.

Edit: To clarify, only my discover card has reported so far. So I expect some bumps in scores when the other 2 cards and the loan reports.

FireMedic1 · ‎10-16-2019

From your first post. "My AAoA will be super low once the 3 baddies get deleted, because I have these new cards and the one remaining baddie only, which is 5 years old at this point." Collection accounts and baddies have nothing to do with AAoA's. Just your 3 new accounts. And it will take an act from God to get LVNV removed. You could try paying off CO if they still own it. You'll see the balance listed on your credit report from CO if they do own it. If its 0 balance they sold it to LVNV. Tell CO you want to pay them in full and ask if they would have a the collection account recalled.

Anonymous · ‎10-16-2019

@FireMedic1 wrote:
From your first post. "My AAoA will be super low once the 3 baddies get deleted, because I have these new cards and the one remaining baddie only, which is 5 years old at this point." Collection accounts and baddies have nothing to do with AAoA's. Just your 3 new accounts. And it will take an act from God to get LVNV removed. You could try paying off CO if they still own it. You'll see the balance listed on your credit report from CO if they do own it. If its 0 balance they sold it to LVNV. Tell CO you want to pay them in full and ask if they would have a the collection account recalled.

Yep am aware of this, but my question was about the car loan not trying to get LVNV removed. So with 4 new accounts aged about 5 or 6 months, all with optimal UTIL and of course on time payments, and the only baddie being a paid in full CO from 5 years ago, what kind of rate can I expect?

Anonymous · ‎10-17-2019

It’s difficult to make that call. In the case of the chargeoff, it was charged off 5 years ago, but has been updating regularly this whole time and has thus been suppressing your scores. It will have only been paid off for a few months when you go for the loan, and a few months is not much time for it to age and allow your scores to recover. A paid CO hurts less over time AFTER it has been paid off. Unfortunately with it sitting unpaid for five years, it has not been aging in a score-healing sense.

My guess is that having it paid will of course help upon manual review, as you’ll have all former debts paid, but your scores aren’t likely to be much higher than now because the payoff will have been so recent.

That being said, if you’re in with a credit union, you may be better off as they seem to be more forgiving than major banks. Virtually anyone can be approved for a car loan since it’s secured by the car, so get your loan as low a rate as you can, which will likely still be quite high, make your payments, and often in as little as six months you can refinance it at a significantly better rate so long as your profile improves over time.

Anonymous · ‎10-17-2019

@Anonymous wrote:
It’s difficult to make that call. In the case of the chargeoff, it was charged off 5 years ago, but has been updating regularly this whole time and has thus been suppressing your scores. It will have only been paid off for a few months when you go for the loan, and a few months is not much time for it to age and allow your scores to recover. A paid CO hurts less over time AFTER it has been paid off. Unfortunately with it sitting unpaid for five years, it has not been aging in a score-healing sense.

My guess is that having it paid will of course help upon manual review, as you’ll have all former debts paid, but your scores aren’t likely to be much higher than now because the payoff will have been so recent.

That being said, if you’re in with a credit union, you may be better off as they seem to be more forgiving than major banks. Virtually anyone can be approved for a car loan since it’s secured by the car, so get your loan as low a rate as you can, which will likely still be quite high, make your payments, and often in as little as six months you can refinance it at a significantly better rate so long as your profile improves over time.

That makes sense for sure. I've only had the relationship with the credit union for about 2 months, also thanks to these forums

Is it possible to refinance with the same credit union, or do I shop around at that time?