Thank you so much for the detailed explanation. by: Chuck
Hello Justin,
I have thought that, since I'm buying a car after a repossession that is more than 2 years old, I would qualify for a decent loan. I am definitely not looking at prime loan rates such as 2.99%, but I had hoped I qualify for, say between 6.99 to 7.99%.
However, I tried to apply via Chase and Capital One, based on your website review on these banks, and they both came back denied. I haven't gotten the letter from them explaining the reason, but I am kinda baffled why they would deny me.
FYI, my FICO score is between 630 - 655 (spread across 3 credit bureaus) but I don't know how difference it is for the FICO Auto Score.
With this score, low credit utilization and high income (6 digits), am I limited to applying to lenders such as Up2Drive and Ally bank?
Thank you,
Chuck
Hi Chuck by: Justin (Editor in Chief)
Up2Drive is a prime lender, so they would be of no benefit to you in this situation. You may qualify for a better approval if you were buying a new vehicle and the loan were approved with the manufactures finance source.
For instance, Ally Bank (was GMAC Finance), Ford Motor Credit (Ford is pretty strong with nonprime loans), Nissan Motor Acceptance, Honda Finance, etc.
Through traditional lenders however just your score alone would probably get you a rate in the 11-15% range. Once they account for the repo however that will change and those rates will typically be higher and approvals a little tougher to come by.
Being that those lenders turned you down, I'd think at this point you will need to work with a dealer that specializes in these types of loans.
Where you might get turned down with a lender as an individual applying, they may be able to get you approved as the dealer applying on your behalf.
Apply with Auto Credit Express to find dealers that specialize in auto loans for customers buying a car after a repossession.
Here is a copy of the last paragraph in the first email I'd sent and I would think that the same would still apply knowing what I know now:
>> I'd think you'd be able to get approved with not the best of rates, pay well on that loan for 12-18 months and look to refinance with a credit union as your credit and score begin to get better. <<
I'm pretty sure at this point though the approval is going to have come through a dealer and you can look to refinance once the repo has gotten a bit older and you've reestablished with a well paid car loan for a minimum of 12 months, but 18 months is better.
Since I don't know the exact depth of your credit and all your past accounts it is hard to be too specific here about what will or won't happen.
Your credit is falling into the C Tier, which is one of the hardest tiers to explain in writing and without all the info I'd need...
Meaning it is much easier to explain when a customer is sitting in front of me with a credit application, their credit file and deal structure.
Sorry to be so vague on some of this, but I hope what I was able to cover was helpful...
Take care,
Justin
Hi Justin by: Chuck
Thank you again for the great information!
I did not realize that Up2Drive and CapOne is considered a prime lender. Even though they can consider low scores (560, etc. based on your website), it seems that my situation (having a repo'd account) just resulted in an automatic denial.
BTW, you mentioned Ford Motor Credit and I noted that there are some dealership here in CA that advertise that I can apply for Ford Motor Credit for ANY cars, not just Ford.
This is true for dealerships that have multiple brand names under the same group, such as Galpin Motors.
FYI, my goal is to get approved BEFORE going to the dealership so I know I actually have a good rate and approval to negotiate for the car price.
Thanks, Justin!
Chuck
Hi Chuck by: Justin (Editor in Chief)
CapOne does not only lend to prime customers, but are considered more of a full spectrum lender, I'm actually a bit surprised they turned you down based on what I know of your situation.
up2drive.com on the other hand may advertise they'll take a lower credit score, but usually do not accept those deals. They are the online division for BMW Bank NA and typically look for stronger credit.
Yes, Ford Motor Credit will finance other vehicles through their dealerships, but if you apply on your own your application will be routed to the dealership closest to your location, so they can sell you the car and process the loan.
Ford Motor Credit is much stronger when they loan on new Fords and certified pre owned Fords vs. other manufacturers used vehicles.
You can apply with Ford if you like and when the dealer calls really pin them down on the approval and the rate before you get there. Then get to the dealership and work on the sale price. They more than likely will not be able to get you approved without some sort of loan structure to submit to FMC however.
Hope this helps,
Justin
hello by: Anonymous
I was behind on some payments for my car and the bank repoed my truck now that bank won't try to negosiate the balance or refinance my truck what can I do I don't want to lose my truck I was almost done paying it help or tips please
Repo'd Vehicle Poster by: Justin Editor in Chief
I'm sorry to hear your vehicle was repo'd, but unfortunately if they've already got the vehicle and are not willing to negotiate, then it sounds like you'll have to get 100% caught up before they give it back. I'm not a lawyer and this isn't legal advice (one should be saught out if legal advice is what you wanted), but I think you're sort of stuck in this situation.
Sorry I didn't have better news...
Justin
True information is sharedNEW by: Ken C. Kendrick
Any way I'll be subscribing to your feed and I hope you post again soon.Thanks for sharing.
Hey Chuck! Don't be panic. I understand what you fear for but I don't think it is going to be that much difficult to buy another car. The answer given here is absolutely right. You can purchase another one very soon. Just be prepared with a good servicing center. Here I am suggesting you one. German Mechanic Chelsea MI. Thank you.
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