Obtaining an auto loan with sparse credit?

[exodus454]

Hey evyerone

I'm trying to get an auto loan for a 1997 Miata M-Edition and keep getting declined from everywhere I've tried applying online (which is about 3 places).

I'm 18, I've had a steady job now for about 3 months and I make ~$1700/mo before taxes ($1500 after). I live with my dad and pay no rent, he also agreed to be listed as a co-applicant on the loan. Basically its all income for me since I have virtually no expenses other than food and gas (borrowing dad's car) for work. I have virtually no credit, but my dad should have fair-good credit.

I'm trying to get a $7500, 36mo loan to buy it from a private party, my grandparents are chipping in $2500 and I have $750 saved up. On a 36 month loan, I see this as completely feasable with insurance included (dad is an insurance agent with his own agency, so he can pull some strings for me).

But anyway, I tried E-Loan, whatever firm eBay uses, and another one that I cant remember and I got declined on all of them. I only listed my dad as a co-applicant on the one from E-Loan, but still, I didnt expect to be denied.


Anyone have any ideas how I can get a loan?

 

[cherrytwist]

Originally posted by: exodus454
Hey evyerone

I'm trying to get an auto loan for a 1997 Miata M-Edition and keep getting declined from everywhere I've tried applying online (which is about 3 places).

I'm 18, I've had a steady job now for about 3 months and I make ~$1700/mo before taxes ($1500 after). I live with my dad and pay no rent, he also agreed to be listed as a co-applicant on the loan. Basically its all income for me since I have virtually no expenses other than food and gas (borrowing dad's car) for work. I have virtually no credit, but my dad should have fair-good credit.

I'm trying to get a $7500 loan to buy it from a private party, my grandparents are chipping in $2500 and I have $750 saved up. On a 36 month loan, I see this as completely feasable with insurance included (dad is an insurance agent with his own agency, so he can pull some strings for me).

But anyway, I tried E-Loan, whatever firm eBay uses, and another one that I cant remember and I got declined on all of them. I only listed my dad as a co-applicant on the one from E-Loan, but still, I didnt expect to be denied.


Anyone have any ideas how I can get a loan?

What kind of credit score does your dad have?

The loan would have to be in HIS name, and you the co-signer (assuming he has good credit...)

 

[aswedc]

Keep on applying with your dad. Lenders will treat cosigned loan basically as his, and if he has good credit, you'll be approved.

Otherwise, you'll have to look for a car from a dealership. They'll approve you with or without your dad.

 

[FoBoT]

join a local credit union that offers auto loans, put the cash you have for the car into it and then apply for a loan from them

good luck

 

[aswedc]

Originally posted by: cherrytwist
The loan would have to be in HIS name, and you the co-signer (assuming he has good credit...)

Uh, no. There is really no difference. In a cosigned loan, both parties essentially have equal responsibility for repayment.

 

[exodus454]

Originally posted by: cherrytwist

Originally posted by: exodus454
Hey evyerone

I'm trying to get an auto loan for a 1997 Miata M-Edition and keep getting declined from everywhere I've tried applying online (which is about 3 places).

I'm 18, I've had a steady job now for about 3 months and I make ~$1700/mo before taxes ($1500 after). I live with my dad and pay no rent, he also agreed to be listed as a co-applicant on the loan. Basically its all income for me since I have virtually no expenses other than food and gas (borrowing dad's car) for work. I have virtually no credit, but my dad should have fair-good credit.

I'm trying to get a $7500 loan to buy it from a private party, my grandparents are chipping in $2500 and I have $750 saved up. On a 36 month loan, I see this as completely feasable with insurance included (dad is an insurance agent with his own agency, so he can pull some strings for me).

But anyway, I tried E-Loan, whatever firm eBay uses, and another one that I cant remember and I got declined on all of them. I only listed my dad as a co-applicant on the one from E-Loan, but still, I didnt expect to be denied.


Anyone have any ideas how I can get a loan?

What kind of credit score does your dad have?

The loan would have to be in HIS name, and you the co-signer (assuming he has good credit...)

Well, he owns the building his office is in, and he just recently refinanced the mortgage on our house with no problem at all so I suspect his credit would be good enough for a $7500 loan.

 

[CTrain]

I'd like to know how can you bring home $1500 if you gross only $1700.
And if you live in Connecticut, there is a state income tax too.

Federal+Soc sec+Medicare should be about 20% of you gross wages and then add in the state income tax.
If they really are only deducting $200 from $1700, then you will be paying some money back during tax time.

 

[Mermaidman]

Do the applications ask about the car you want to buy? AFAIK, the 'good' lenders don't extend loans for cars older than 5 years.

 

[exodus454]

Originally posted by: Mermaidman
Do the applications ask about the car you want to buy? AFAIK, the 'good' lenders don't extend loans for cars older than 5 years.

Really? Damn.. I really want my miata.

Can anyone think of any tricks or anything that could help me out here? I know a lot of you are good with financial type stuff.

Originally posted by: CTrain
I'd like to know how can you bring home $1500 if you gross only $1700.
And if you live in Connecticut, there is a state income tax too.

Federal+Soc sec+Medicare should be about 20% of you gross wages and then add in the state income tax.
If they really are only deducting $200 from $1700, then you will be paying some money back during tax time.

I'm pretty sure the numbers are correct, but I can check when I get paid on the 15th.

 

[Dunbar]

Have your dad loan you the money.

 

[Yzzim]

I have a friend who has terrible credit and he was able to get a loan with a fairly good interest rate from State Farm (yes, the insurance place).

I checked them out and their interest rate was a little high for me. I decided to go with USAA (usaa.com) and found the interest rate was a whole percentage rate lower. I've heard great things about USAA and I would definitely advise checking them out.

You might run into borrowing money for a car that old. I've heard lenders don't like to borrow money on cars that will be over 10 years old before the loan is paid off.

 

[GeekDrew]

I had no credit at all when I needed to buy my first car. A dealership was able to get a local bank to open an auto loan for me, even though they had previously denied opening a loan account with me. Percentage isn't that great, but hey, I didn't have a lot of options.

Oh yeah, and just to jump on the bandwagon -- I really, really doubt you'll find anyone to loan you money on a 1997 vehicle. That's almost 10 years old, already. Many hesitate to loan on vehicles even 5 years old.

 

[exodus454]

Is there any way I could take out a normal loan and use it to pay for a car?

As you can probably tell, I've never really paid attention to loans at all, so I'm learning as I go..

 

[T9D]

http://www.prosper.com/

You'll probably have to get a pretty high interest rate but if you are sincere enough those people will fund you. (it's people to people lending, no banks)