I recently posted that I was looking to buy a new car, but now I have a question as I've been doing a bit of research.
I will be getting a decent sum of money when I am able to cash in my company stock option in March. I was going to wait until then to buy the car and put a decent down payment on it. This month there is a 500$ rebate on the car if I finance with the dealership. So if I bought the car now, then refinanced in March with a credit union with a big down payment would this have a big negative impact on my credit score? Should I wait or is this a fairly safe thing to do?
My credit score is in the 700-720 range
I'd also suspect that you can negotiate a better deal if you bring in more cash. Or is that only if you don't take advantage of the dealership's financing? Because "free" financing just means you pay for it in the price of the car. Nothing is free...
Get your own financing and cut out the middle man, saving yourself 2k.
Last edited by Lyrical; 12-17-2012 at 07:03 PM.
Are you financing through the dealership or the manufacturer/manufacturers finance division?
HUGE difference. Manufacturer will subsidize the fuck out of your note to move the metal, and will provide a FAR better rate than any bank will offer.
If you're buying a well-used car, nm. If you're buying a lightly used car, well, you're getting fucked - a new car will end up costing you less due to the manufacturer incentives.
fuck new cars, buy used outright. put the payment you would be making monthly for the next 3-5 years towards savings / investments. cars are nothing but losers, especially new ones.
The way I have purchased my last few cars has been negotiate the price of the car first. It's very easy to get invoice costs and the like with the internet these days. Then come back with your own financing. As long as you know what your state's additional taxes and fees are, there's pretty much no way to get ripped off like this.
And while I agree that new cars are terrible investments, I've never looked at it as an investment. It's a luxury to buy new and if you can afford it, while sticking with your budget/retirement savings/etc, I say go for it.
So I really fucked up my credit when I was younger. I ended up getting a Dell computer on one of their cards ($1500), spending $1500 on my Capital One card to buy a guitar, $500 on an amazon credit card, $500 on a paypal card. I basically said "fuck paying this" and eventually they came after me for huge amounts of money. I paid them off at that point, but the damage was already done. My credit score sat roughly at 600 even.
I go to school so I have a large amount of debt there, and that's it. I paid off all of the collectors that I owed and I also ended up paying off my car loan pretty early.
What is the best way for me to rebuild my credit? It is already slightly better than it was before (around 620), but I'd like to keep improving it. I have a really good income now, so I'm not worried about falling into the same trap again.
I need a new car, so will getting a new car loan and paying it off monthly/early help build my credit? Should I get another credit card and use it for small purchases and then pay it off? Looking for a little advice.
The best way is to keep paying on time, basically. Having a car loan and credit cards on file and paid on time will start building it back up. It's not really something you can fix quickly. Having a mortgage that is paid on time helps a great deal, but judging from where you're at in your post, you're probably not looking to buy a house just yet. Basically, pay ALL credit debt off every month. Do not carry a balance and most definitely do not pay interest on credit card debt(ie: if you have to carry debt, get a card with an introductory 0% rate - that will require you to get a higher FICO score though).
Major loans, paid on time, will increase your credit the fastest (car loan, mortgage)
You can also build it back up using credit cards, but you'll have to pay on them longer compared to a car/house loan to see the same improvement.
Generally speaking, get 1 or 2 credit cards(secured if you must, if you can't get a normal card because of your credit), charge maybe 1/3 - 1/4 of the limit per month and pay it off each month. Never max the card, in fact, don't even go over 50% of the way to the limit. To improve your credit, credit companies want to see that you can acquire credit, and use it responsibly, which means not maxing your card out every month even if you do pay it off.
This doesn't mean that you have to go out and buy stuff to improve your credit. Put gas on it, or groceries, or something you would be buying regardless.
I did the same thing as you Noodleface, (posted about it a bunch back on FoH), basically racked up 10K in credit card debt my last years of college and the couple years afterwards. Took me forever to get out of that hole but I eventually did. It honestly took a good 5-6 years of really working at it to get back to a 750 credit score. I think I was around 570 at my worst.
If you still have some of your credit cards(probably not if you didnt pay them) use 1 or 2 of those to work your credit back up, credit is also determined by the longevity of your accounts. It looks better to have a couple cards that have been open for years than it does to have a couple brand new cards.
/Can't remember if it's 7 or 6.
Dealers absolutely lose their shit when you negotiate price and then when you get to F&I, write them a check.
Last edited by Lyrical; 12-28-2012 at 03:15 PM.
Hah ill have to keep that in mind. Just asking for a final price seems to be an adventure from these dealerships.. I'm guessing most cars have a 1-3k wiggle room on them? Sometimes more?
I always try to negotiate every step seperately. If you are trading in a vehicle + purchasing a new vehicle + financing the vehicle, be really wary about the dealer just talking in final overall numbers. They can make the new vehicle price look great by screwing you on the trade-in, or vice versa, or make both vehicle prices look great by gouging you on the loan.
I always negotiate on the vehicle I want and get a final price before I even mention my trade in or agree to talk about financing. I generally don't finance through the dealership/auto manufacturer unless they are offering a 0% promotion at that time.
Yea.. I need to get them to raise the price of my trade in at this point. They offered me 15,500 but I'm wanting more like 16,500-17k for it. They will prob try and sell or for over 20k so..
Check Kelley blue book to see the approximate value of your trade-in.
Good information to those who responded to me. Starting to work on my credit again. It helps to have a very good job now where I am not scraping by (for the most part).
If you have the cash, usually $300+, secured cards work pretty well. They report the same on your credit. Downside is they usually have an annual fee. I've had lots of people get counter-offered for a partially secured card. If you have been with a bank for a while, sometimes they can request a relationship review with the application. It might not get you a high limit, but if your trouble is getting approved it will start you out with a low limit card and no annual fee.
If someone checks your credit you most likely wont take a hit. It's also noted when someone makes a credit inquiry opposed to applying credit on the report.
I just got my credit reports back after applying for my mortgage.
I had negative marks for: Not enough revolving credit, too much revolving credit, and too many recent credit inquiries. my score was still 780 but it's stupid to me
credit reports? you can't explain that.
They're going easy, I would dock you for inconsistent amounts of revolving credit
Fuck credit score companies, making money off my personal info which they charge to look up.
Switzerland doesn't have any credit bureaus, which means that everyone is charged the same rate - in excess of 10%. If there's no way to identify low-risk (or high-risk) borrowers, that's very costly for those who are low risk.
Recently, private companies have started accumulating data and trying to make risk estimates. The problem is that there is no disclosure requirement at all, so you cannot get anything like a credit score or credit report. In one case that made the news, someone learned that he was mistakenly associated with someone else who had the same name... so he ended up being denied shit like leases because landlords thought he had a debt problem, when in fact he had plenty of savings and no debt at all. Based on the report, there was no way for him to even correct that - he contacted the firm keeping the data and they basically told him to get lost. Even if he could correct it, there's really no way of knowing how many firms there are that do something similar and how many of them may have wrong information.
Having central credit bureaus that are required to disclose everything they have on file for you is an awesome setup. Getting a free credit report (from each bureau) once a year is an added bonus.
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