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Auto loan, need ur suggestion


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Hi all,

My credit record has just started. Itz been 3 months now and I have started my work. I have just one secured CC from bank of america and my credit score is above 720, since it is new. I am planning to buy a car, my question here is: Will I be approved an autoloan at this point, plz suggest me some good financing options.

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Depends on the lender. You will be approved by one, because they know that if you default they just take the car. But the APR is going to be high.

Obviously your own bank or credit union is the first to check with. Then would be the car makers credit division (GMAC, Ford Motor Credit, etc)

I would stay away from Triad Financial - a predatory lender (aka Roadloans.com), only because of some BS I'm dealing with with them now (an unauthorized credit pull).

Cap1 offers blank check auto loans.....interest rate and max amount of loan vary. But even at my worst two years after the ch7, I applied just to see if they would accept me. They did for $15,000 I think it was at 15%. Two years ago I applied again and was approved for $21,000 at 9%.

Plus many car dealers have many different lenders that they deal with. Just make sure that you're getting the best rate before you sign anything. Even if it cost you a full hard pulls.

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I would suggest that you not let the car dealer arrange your financing. Go to a local bank or credit union; someplace you can trust. Get pre-approval from the bank, then go find your car. You can then do a cash deal for the car.

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You have a damn good score!

Go to a credit union. Call them up and ask to speak to the loan department and talk to a real loan officer on the phone. Tell them what your situation is and what your score is.

Go to this web site:

http://creditunionaccess.com/

It has every credit union in your immediate area...

Scores aren't everything. If her history is only three months old, and she's never had a substantial car loan, almost everyone will want a co-signor, regardless of her score.
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That is why you should go to a credit union.

Major commercial banks are interested in the prime and super prime customers in which they take everything into consideration. Although 720 is just about a super prime customer, those kinds of lenders can find things to knock you down into a B or C category instead of the A.

If you go to a credit union, then there is a very good chance that you will be treated as an A customer. I would foresee the worst as being downgraded to a B.

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Hi all,

Thanks a lot for all your suggestions.

First of all i tried getting a loan from cap one, but i got rejected...

I was told by one of my collegues to approach a local bank, i spoke to them, they said that they need to see 6 months of my salary slips. I told them that i started just 3 months back, they asked me to come after 3 months

now im planning to talk to a credit union....

though i have a good score, my a/c history has just now started, since it is less than four months ppl are not ready to finance me may be!

I wonder what these ppl might ask me..6 months or 1 year salary slip :-)

Anyway, thanks a lot for writing your views, I appreciate it...This forum is really good! thank u.

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Not true ... with her score she will get a loan at a good rate. Plus you need to try and establish your credit history on your own ... if something was to go wrong (which I am not saying at all it will) someone else also get's stuck with it. A 720 score will put you in the 7% to 9% interest rate.
Then why's she having such a hard time getting financed?
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We don't even know what kind of score this 720 is. No one has "a" credit score.

Anyway, auto loans are scored differently, and we don't know where she stands in terms of that scoring model. For all we know, she has a 550 in their world.

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  • 2 weeks later...

I would say try the dealer. You can save a lot of running around that way, just be firm with the sales people, get the terms, go home and think about them, maybe even post up here, and see.

I've walked into many dealerships with pre-approved checks/credit lines, and they will almost ALWAYS want to see if they can get a better rate for you, and IMO, let them try, you never know what they might come back with, and you ALWAYS reserve the right to say, "no", get up and leave.

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Even my credit file is new..I got rejected by almost all big lenders....So, i approached my dealer, spoke to him and he tried getting me a deal... and finally offered me 12% interest rate..ive thought abt it a lot, now ive decided to go for it..i am gonna make a huge down payment..i think this will surely make a big difference...btw the dealer never asked for my salary slip...should i take a copy of it anyway?..

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respectfully, i suggest waiting at least (at least) 1 yr. on job, (at least) 1yr. at current address, (at least) 1 yr. on-time payments...my guess is that the "turn down" may be somewhat related to "job stability"...i hate those auto dealer scam artists that gouge you for "larger down payments" to secure the loan...it's BS given their charging 12% for the loan (your rate less prime gives you the "risk" premium they are already charging)...just my $0.02 - my humble opinion is to wait on the car...if you can...

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Erica

I have been in the auto sales industry for awhile and there are certain things to watch-out for as a young person car shopping and loan shopping.

If you will take time to visit a couple of credit unions in your area, I am sure you can find one who will be happy to grant you an auto laon at a very favorable rate. A great thing about credit unions is they have "safety-nets" in place so you cannot be overcharged for a vehicle. Another great thing about credit unions is they are not "greed driven" so you are sure to get a great rate.

In my area in Texas there are a couple of credit unions willing to loan money to folks with as little as a 6 month old account with a credit limit as low as $300. How can you beat that?

Check into the credit union market in your area.

The thing to watch out for on the car lot would be salesmen who like to take advantage of the "uneducated buyer" and young people generally fall into this category, but as long as you learn the value of the vehicle before you purchase you'll do good.

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