Credit, Cars and (quite possibly) the worst Candidate.

[Whiskey]

I'm in off topic more than I'm in SC lately. Oy. So heres a quick TL;DR bulletpoint list of facts.
The car I want is essentially

• 2000+
• Under 100k miles
• high MPG (25-34) City/Fwy
• Green, preferable, but not required.
• 10k max spending limit.
• Example car: 2005 Chevy Aveo (from a random zip code, its about a grand more for the same car with 30k more miles)
• Completely unrealistic sexy option: 2001 Audi TT Roadster

My issue is:

• My credit is something like 520 from one credit card and medical bills. [1]
• I have no one to co-sign for anything, ever. [2]
• I've only been at my (now relatively shakey) job for 4 1/2 months.
• However, I do get $5,300 from financial aid per year. [3]
• My rent is income-based.
• The only bills I have to pay are car insurance, cell phone and internet. [4]

[1] The credit card should be falling off my report fairly soon, I think, but I don't know if medical ever does. Just found out nothing falls off until Mid-2014

[2] No, really, I have no one to cosign.

[3] I go to school full time in Spring/Fall and I don't actually buy any books since I only take courses with teachers who put their textbooks in the library on reserve for enrolled students. My tuition and fees are covered by a state program since I'm extremely low income, so thankfully, college is essentially free. Well, I paid 53$ in health fees and a parking pass because fuck campus parking, man.

[4] My phone bill is something like 80$ a month, but I can severely cut that down and my internet is 20$ which I'm under contract for but I'm sure theres some kind of suspension due to financial hardship program. A girl can dream. Even if theres not, with no reduction (not including rent) my bills only come to 210$ a month.

Heres the Long Version:

I'm basically the worst candidate for a car loan and I'm trying to figure out how to get one. I really prefer to buy outright, but I'm on a quest to fix my horrible credit. I got a secured card 2 months ago and have been doing well (spending more than I'd like, but paying it off in full every month). I've never been very good at paying my bills on time (mental health reasons), but lately I've been stable on my meds and since April I've been late only on 2 bills, and both were by days due to a change in my pay schedule (every other saturday changed to the 7th and the 22nd).

I have a high likelihood of paying off the car early, which isn't bad, but it isn't great for the credit either or my chances of getting a loan since paying it off early means less interest for the dealer. I already know my interest rate is going to be something like 29%. I have a car right now thats a lemon. I was paying on it under the table through a friend, but the guy won't fix the car so he's giving me my money back (or my friend is going to break his nose again). Thats 1560$ towards a downpayment. Then, if I manage to sell my other car for a grand or whatever, thats $2500 to a downpayment. Then in the end of august (i believe, maybe 1st week of september) i'll get a check from school for 2675.00 for financial aid to get me through the semester. Since I don't buy books and paid my fees while I was working 2 jobs, that money is free and clear for whatever.

I'm in a pinch, like I'm always in a pinch, because I fail to plan. Is there anyway to spin my situation to make it sound like a decent deal for a car dealer? Usually I would just go out and buy a 2000$ beater, but in California 2000$ will get you a 1990 Geo metro with 210,000 miles and blown transmission. I'd actually like to get something thatll last me more than 1 year (which has never happened). I'm in a position where it seems almost likely and I'd like to have decent enough credit to pull some okay loan rates when I ship off to UC. I also drive cars until I run them into the ground, so I'm not up on savvy car dealings. The last time, with similar credit, no one would sell me a 10k car, but they would sell me a 15k car (new car). I don't buy new cars as a rule because if I do want to sell them I automatically lose money driving it off the lot. I'm uncomfortable having a 6-8k loan over my head, let alone a 12k loan. If I left out anything, let me know and I'll field the question.

Thanks for putting up with my rampant off topicness This might all be irrelevant, with school I make ~15k a year. Without school I make 9-10k, part time.

[trailerparkmedic]

I'd like to have decent enough credit to pull some okay loan rates when I ship off to UC.

No advice on how to get a loan, but I can tell you that federal student loans are not based on credit and are at set interest rates. My subsidized are at 4.5% and my unsubsidized are at 6.5% though that can vary from year to year. You only need to worry about your credit if you need private loans.

EDIT: As for things falling off your credit report, it is 7 years from the last date they try to collect. I'm pretty sure medical bills are treated the same as other bills.

[It's me]

Have you gone to your bank and asked them about a loan? If you can manage to get a bank loan then you are not restricted to buying from a car dealer that does financing (it's usually 3rd party financing anyway).

You can save a bundle buying privately. There are somewhat greater risks that way (private sales are usually "as-is", with no warranty, but even dealers usually don't give great warrant etc. on older used cars.) And regardless of whether you but from a dealer or privately you should get the car checked by an independent mechanic... yeh, will cost you some $$'s up front, but saves on the $2K tranny rebuild later!

[Whiskey]

Have you gone to your bank and asked them about a loan? If you can manage to get a bank loan then you are not restricted to buying from a car dealer that does financing (it's usually 3rd party financing anyway).

You can save a bundle buying privately. There are somewhat greater risks that way (private sales are usually "as-is", with no warranty, but even dealers usually don't give great warrant etc. on older used cars.) And regardless of whether you but from a dealer or privately you should get the car checked by an independent mechanic... yeh, will cost you some $$'s up front, but saves on the $2K tranny rebuild later!

My bank wouldn't even give me an unsecured credit card (which is why I have a secured card which will go unsecured pending good payment history for 1 year).

Like I said in the original post, I only have 2 grand max to buy a car outright which will get me jack shit in california, let alone a car that'll run for longer than 1 year. Plus it'll do absolutely nothing for my credit score. Any financing I get for a car won't be through a bank. Itll be whats called "in house" financing, if youre not familiar, where the charge crazy interest in hopes you default on the contract, or hell if you pay out the contract you've paid 30% interest on a 9000$ car.


Thanks Trailerpark, I thought federal loans weren't based on credit but I wasn't sure. I won't have to take much out in loans, thankfully, since i'll be getting full ride I'm going to go apply for an Amex black card or something ridiculous so they'll reject me and I can get a free credit report early. I can't remember who I got one through earlier this year and I'm lazy. I just pulled one from Experian. I'm a little afraid to look.

[trailerparkmedic]

Linky with amount of federal loans you're eligible for each year of school.

Fiance went to a public school with an EFC of anywhere from $3 to $24. He was a dependent student and able to get by on grants, scholarships and a mix of state and federal loans. He also didn't work except for summer breaks. I think he even avoided loans the first year because he did work study.

I wouldn't focus so much on getting a car loan to fix your credit score. It will be a VERY expensive way to fix it. Waiting until things fall off, setting up payment plans or settlements on current debt (I settled a $2200 debt for $100!), and establishing a good credit history with your credit card and future student loans are cheaper ways to improve your credit. If you have too much debt compared to your income, that hurts your credit score, so keep that in mind too.

[Whiskey]

I wouldn't focus so much on getting a car loan to fix your credit score. It will be a VERY expensive way to fix it. Waiting until things fall off, setting up payment plans or settlements on current debt (I settled a $2200 debt for $100!), and establishing a good credit history with your credit card and future student loans are cheaper ways to improve your credit. If you have too much debt compared to your income, that hurts your credit score, so keep that in mind too.

Things don't fall off for another four years. I'm doing debt verification on all the debts I have today, so if they don't respond in 30 days then they'll have to delete it off my credit. From what I've read about who now owns my credit, they violate the FCRA quite a bit so chances are a Very Formal Letter asking them to verify every transaction will scare them off.

I still need a car, once again, 2k will not get me a car thatll last more than a year, which is what I need. I can't go through buying and selling a car once every damn year like I have been for the last five years.

edit: I just paid off one of my new debts (ick, meant to pay it before it hit my report, damn it) today. Go credit repair, go.

[Solumina]

As others have said there are much better ways to fix your credit but if you need a car then you need a car. Check and see if your school offers any kind of financial advising office. The one at my brother's school really helped him when he found them 2 years ago. His credit isn't great, that will take some time, but it is much better than it was.

[Treasure]

Ok I'm going to recommend - if you can - wait until the FinAid ck comes in - then you'll have 4k - you should be able to get into a decent used car from a dealership for around that - no it doesn't help build up your credit, b/c you bought it out right, but it will take the pressure off you - you can still work on paying off old debts without worrying about a new one.... start looking now for you a car - it may not show up for a few months, but also if you go talk to a dealership and let them know what you are looking for - and give them your number, sometimes (not always) they'll remember you and call you if something comes in.

believe it or not - go in to a dealership, a reputable one not a "fly-by-night", and basically tour the lot, and explain your situation - that y ou've been homeless, and are pulling yourself up by your bootstraps, and your trying to get your life back in order, going to university, etc etc etc - they will have some sympathy for you and want to work with you and find you the best financier they'll actually submit your paperwork to 3 or 4 companies to see who comes back with a "yes @ reasonable" and believe it or not - you may qualify for "New Buyer Discounts" so don't be afraid of a "new" car - look at new 08 or 09 models - they'll be begging you to buy it to get it off the lot to make room for the 2011's
and go at the end of the month, end of Qtr is better - any thing to make a sale!!!

(why yes i did used to work for a dealership, why do you ask?)

[Whiskey]

Ok I'm going to recommend - if you can - wait until the FinAid ck comes in - then you'll have 4k - you should be able to get into a decent used car from a dealership for around that - no it doesn't help build up your credit, b/c you bought it out right, but it will take the pressure off you - you can still work on paying off old debts without worrying about a new one.... start looking now for you a car - it may not show up for a few months, but also if you go talk to a dealership and let them know what you are looking for - and give them your number, sometimes (not always) they'll remember you and call you if something comes in.

believe it or not - go in to a dealership, a reputable one not a "fly-by-night", and basically tour the lot, and explain your situation - that y ou've been homeless, and are pulling yourself up by your bootstraps, and your trying to get your life back in order, going to university, etc etc etc - they will have some sympathy for you and want to work with you and find you the best financier they'll actually submit your paperwork to 3 or 4 companies to see who comes back with a "yes @ reasonable" and believe it or not - you may qualify for "New Buyer Discounts" so don't be afraid of a "new" car - look at new 08 or 09 models - they'll be begging you to buy it to get it off the lot to make room for the 2011's
and go at the end of the month, end of Qtr is better - any thing to make a sale!!!

(why yes i did used to work for a dealership, why do you ask?)

If I could wait for the aid check, I would. I much much prefer to buy cars outright. I work graveyard though and I need my car to get to work (buses stop running at 7PM here). It might be necessary to take my other car to the shop and have it repaired. Its an 89 Camry with an ungodly amount of miles and issues. Everytime I fix it, something breaks and its a money sinkhole to keep running. Bah.

Also, in August of 09 I was looking around for cars and couldn't get approved at legit dealerships because Banks will not finance me. I asked if there were ANY options available for someone like me and they're response was basically "no." Not much has changed. Unless you got some insider tips. I'll give you one of my delicious pork pulled sandwiches for insider tips.

Update: No one will finance me under any condition. I guess its yet another beater that'll break down on me at any given moment. Hooray.

[Aethian]

1. The needing of a car loan is a myth. No one needs a car loan.
2. Set up a budget ASAP, sounds like you really need one bad.
3. List ALL of your debts in order smallest to largest (why yes I am a Dave Ramsey fan).
4. If you need a budget buddy, I am available and what I mean by buddy is I'll look at yours if you'll look at mine.
5. Start working on those debts.


6. If you need a link to someone who does manual underwriting for insurance, let me know. I do know a few good links.

[Whiskey]

1. The needing of a car loan is a myth. No one needs a car loan.
2. Set up a budget ASAP, sounds like you really need one bad.
3. List ALL of your debts in order smallest to largest (why yes I am a Dave Ramsey fan).
4. If you need a budget buddy, I am available and what I mean by buddy is I'll look at yours if you'll look at mine.
5. Start working on those debts.

I'm aware and do all of this. Dave Ramsey is a smart man.

[Imprl59]

Not trying to be negative here, but the reality of the situation is you can not afford a 10k car.

The only way you are going to get financing with your credit and still being in school would be a buy here pay here lot where you are going to pay twice what the car is worth and then ungodly interest.

Used cars in California don't cost that much more than they do anywhere else in the country once they age out. If I were in your position I would be looking at a mid to late 90s American car something like a Buick. Is that your dream car? NO. But you can get a decent "grannys car" wth 100k on it for 3k dollars at most and it will run for years. Parts are cheap and every corner mechanic knows how to work on them

Steve B.

[Whiskey]

Not trying to be negative here, but the reality of the situation is you can not afford a 10k car.

The only way you are going to get financing with your credit and still being in school would be a buy here pay here lot where you are going to pay twice what the car is worth and then ungodly interest.

Used cars in California don't cost that much more than they do anywhere else in the country once they age out. If I were in your position I would be looking at a mid to late 90s American car something like a Buick. Is that your dream car? NO. But you can get a decent "grannys car" wth 100k on it for 3k dollars at most and it will run for years. Parts are cheap and every corner mechanic knows how to work on them

Already came to this conclusion about five posts ago.

[Whiskey]

1. The needing of a car loan is a myth. No one needs a car loan.
2. Set up a budget ASAP, sounds like you really need one bad.
3. List ALL of your debts in order smallest to largest (why yes I am a Dave Ramsey fan).
4. If you need a budget buddy, I am available and what I mean by buddy is I'll look at yours if you'll look at mine.
5. Start working on those debts.


6. If you need a link to someone who does manual underwriting for insurance, let me know. I do know a few good links.

I might actually take you up on this. I only have 3 debts, one of which are paid off. PM me/IM me if you feel up to it. I can be a bit abrupt and my humor is odd, so don't get offended. Im fairly nice A little financial accountability (even to a stranger online) isn't a bad thing.