Once the SL is $0 balance and the car is paid off. You'll get the no loan penaly. You can open a SSL if you can get in with NFCU or PENFED.
@krmurrayjr10 wrote:So, I have several changes to my credit report and FICO score I'm anticipating in the coming weeks, and am looking for suggestions on how best to proceed.
My student loans were forgiven this week, and I am waiting for them to be updated as paid on my credit reports. The current balance is much higher than the original disbursement from 2009. The score tools I've checked online all seem to be in agreement that the loan being paid in full will not have any effect on my score.
I also have a car loan with Capital One. I just made the 59th payment, which will leave a balance of about $400 to be paid in September. The score tools show my score dropping as much as 30 points when this installment loan is paid off.
How long will this point drop last? Am I better off getting a new car loan now and letting that loan pay off the old one, versus getting a loan a month or more from now when my score will be lower? Should I wait for the student loan to show a $0 balance before applying for a car loan?
I'm just trying to think of the best approach to take in the month or so that I now have before the existing car loan wraps up!
Do you need a new car? If not, then skip the car loan and get a share secured loan with PenFed or NFCU, and then pay it down to 9% of the loan amount. That will keep you from getting hit with the no-open-loan penalty.
@krmurrayjr10 wrote:Thanks for the feedback!
I'm on the fence on the auto loan. On the one hand, I don't "need" a new car yet, but on the other hand, I've long wanted a BMW (have a nice VW) now, and at the moment, I have the ability to make that happen: a six-figure salary, decent credit, and a trade-in that is only going to get less valuable as time passes.
I'm a member of both PenFed and NFCU and did a prequal on Penfed's website this morning. They soft-pulled Equifax and are offering 60 months on a theoretical $45k loan at 7.24%. There are also 2 other offers there at 84 months and 36 months.
Comments?
Forget the prequal's. You're looking at personal loans. I'm not suggesting you take out a personal loan. A share secured loan is a horse of a different color. You won't find these on the website; you just call up.
What you would do is: deposit $3k to $5k in a PenFed or NFCU savings account; take out a share secured loan for 60 months secured by the savings account; then take the extra money in the savings account and use it to pay down the SSL to 9% of the loan amount; then pay down the loan very slowly for the next 60 months. That way, without getting into any more debt, you've covered your bases for 5 years on avoiding the 'no open loan' penalty.
@SouthJamaica wrote:
@krmurrayjr10 wrote:Thanks for the feedback!
I'm on the fence on the auto loan. On the one hand, I don't "need" a new car yet, but on the other hand, I've long wanted a BMW (have a nice VW) now, and at the moment, I have the ability to make that happen: a six-figure salary, decent credit, and a trade-in that is only going to get less valuable as time passes.
I'm a member of both PenFed and NFCU and did a prequal on Penfed's website this morning. They soft-pulled Equifax and are offering 60 months on a theoretical $45k loan at 7.24%. There are also 2 other offers there at 84 months and 36 months.
Comments?
Forget the prequal's. You're looking at personal loans. I'm not suggesting you take out a personal loan. A share secured loan is a horse of a different color. You won't find these on the website; you just call up.
What you would do is: deposit $3k to $5k in a PenFed or NFCU savings account; take out a share secured loan for 60 months secured by the savings account; then take the extra money in the savings account and use it to pay down the SSL to 9% of the loan amount; then pay down the loan very slowly for the next 60 months. That way, without getting into any more debt, you've covered your bases for 5 years on avoiding the 'no open loan' penalty.
^^^^ This is the best solution.
I get the feeling OP want's a new car, and wants us to support the decision. 
The car would be fun, but not the easy, best financial answer for the problem.
If you wait and see, the hit might no be that bad.
I lost only 18 points from no credit mix.
@krmurrayjr10 wrote:Thanks for the feedback!
I'm on the fence on the auto loan. On the one hand, I don't "need" a new car yet, but on the other hand, I've long wanted a BMW (have a nice VW) now, and at the moment, I have the ability to make that happen: a six-figure salary, decent credit, and a trade-in that is only going to get less valuable as time passes.
I'm a member of both PenFed and NFCU and did a prequal on Penfed's website this morning. They soft-pulled Equifax and are offering 60 months on a theoretical $45k loan at 7.24%. There are also 2 other offers there at 84 months and 36 months.
Comments?
The minute you drive a car off the lot. Car loses 10,000 in value.
Yep, never buy a new car. Let someone else take the depreciation.
