Question on credit and finance rates

[crombie09]

So I bought a truck yesterday. 2003 GMC Sierra. Pretty nice. Onlt bad thing is that I have bad credit and my finance rate is 16.9% So my payments are $450 a month. Honestly thats kind of steep for me but I just have to watch where I spend my money a little more.

The bank said after 2 years of paying on time that my credit score will be much higher. Is there any way to get a lower finance rate so my payments arent so high sooner than that?

I know the payment is high but thats what I get for screwing my credit when I was younger.

[a-bomb83]

Re: Question on credit and finance rates

hey man, the interest rate on mine is 24%.

to answer your question, no. you're going to have to suck it up for about a year/year and a half (with perfect payments of course) then try and refinance.

let me share with you how much better your rate is than mine. the initial cost of my car was roughly $11,000. if i paid the $290/month for the entire 72 months...whats 290x72? $20,880!!! so, needless to say i'm going to refinance soon and try to get that damn payment down. low 200's would be looovveee!!!!!!!

[O2BESOHUGE]

Re: Question on credit and finance rates

YUP, LIKE ABOMB SAID....PAY ON IT FOR A YEAR OR SO AND THEN REFINANCE THE PAYOFF. BY THEN YOUR CREDIT WILL HAVE HAD A CHANCE TO BUILD BACK UP

O2

[daved150]

Re: Question on credit and finance rates

well, it's gonna be a little tuff for both of you, becouse at the point of time that you go to refinance, your both gonna be dealing with a negative equity situation. abomb is probobly in a little better position, becouse he baught the cheaper car. at the end of 1.5-2 yrs, his poyoff will be lower...crombie, you signed on a much higher loan...at the end of 2 years, your gonna be upside down. the credit will be better (depending how bad it was), but the banks wont finance over the cars nada trade value (maybe 15% over, but that's about it)...my suggestion to both is to try to save up some $ to by the payoff down at the time of refinancing...join a credit union now, and be active- savings and checking...even if's it's small transactions, they like to see movement...do this and you should get through it ok.

[O2BESOHUGE]

Re: Question on credit and finance rates

YUP ANYTHING TO DO WITH CARS...DAVE HAS DONE IT OR KNOWS HOW TO DO IT

THANKS DAVE
O2

[crombie09]

Re: Question on credit and finance rates

well, it's gonna be a little tuff for both of you, becouse at the point of time that you go to refinance, your both gonna be dealing with a negative equity situation. abomb is probobly in a little better position, becouse he baught the cheaper car. at the end of 1.5-2 yrs, his poyoff will be lower...crombie, you signed on a much higher loan...at the end of 2 years, your gonna be upside down. the credit will be better (depending how bad it was), but the banks wont finance over the cars nada trade value (maybe 15% over, but that's about it)...my suggestion to both is to try to save up some $ to by the payoff down at the time of refinancing...join a credit union now, and be active- savings and checking...even if's it's small transactions, they like to see movement...do this and you should get through it ok.

FYI I got my truck for 450 a month for only 48 months. I got mine for 14k with a 2 year unlimited bumper to bumper warranty.

[crombie09]

Re: Question on credit and finance rates

YUP ANYTHING TO DO WITH CARS...DAVE HAS DONE IT OR KNOWS HOW TO DO IT

THANKS DAVE
O2

Yup.....

[daved150]

Re: Question on credit and finance rates

well then...you aint that bad off. keeping the term as low as possile was a good thing...do the credit union thing, and check with them in about 14 mo's. how much was the extended warranty? did you look on line to see if you can pick one up cheaper...if you decide to do that, and you infact find one cheaper, you can cancel the extended and they'll refund the balance (they prorate it, but you havnt had it long). now, they send the refund directly to you, but you can deposit, and write a check telling the bank to put towards your payoff....it really dont sound like you credit was all that bad bro. i sign people 19.95-23.95 all the time!! do the credit union thing, and inquire about it in about a year...you may get off very cheap

[crombie09]

Re: Question on credit and finance rates

Thanks. I already have been at my credit union here for about 7 months. Is that a good thing? I dont really know how credit unions work. I just had to get them to have direct deposit, so I did.

[crombie09]

Re: Question on credit and finance rates

Oh and the warranty was like 1500 for 2 years.

[T-Man007]

Re: Question on credit and finance rates

Good night, I could not imagine those kinds of rates. Our car is at 4.5%. If it was me, I would pay as much as you can extra each month to pay down the principle. It really shouldn't take more than 12 months of making your payments on time to boost your score. If you are paying down the principle each month and pay on time, youshould be able to get a new loan in a little over 12 months. But, just to warn you, because this is a new loan you score will drop before it goes up. It has to do with the rating system. They (the credit bureaus) put a lot of weight on the lentgh of the lines of trade (or your loans). For example, last year I refinanced my house and bought a condo for an investment property. Well, about 3 months later my score dropped about 20 points because both the loans were so short. After about 12 months of establishing a payment history, I wont get dinged for the short time period any more. Which leads me to another point. If you have multiple credit cards and you want to switch them to a 0% apr intor card you should do all of them at the same time. This way, they all become 'new' lines of trade at the same time. If you do one, then wait and do another, then wait and do another, you may fail to qualify for the last one because the 'new' loans could ding your score.

I've been in your shoes. My credit was soooooo bad at one point I could not even get a checking account. I had to put my paycheck in a savings account and then go get cash and do money orders to pay my bills. That was probably the most embarassing thing in my life. I made sure to never screw up my credit since. It took several years to finally get it where it is now. So, just be smart, pay early, pay extra and get your score up.

[daved150]

Re: Question on credit and finance rates

Thanks. I already have been at my credit union here for about 7 months. Is that a good thing? I dont really know how credit unions work. I just had to get them to have direct deposit, so I did.

yup, thats a very good thing. make sure the account is active...when i had my prob's (long story, but i learned alot) i would actually transfer money from the savings to the checking, then write a check for something i had the cash for, then deposit the cash in my savings...a little labor intensive, but believe me, they like to see an active member! i'm seriouse...i would try it in about 12-14 mo's. i know it's a little late now, but did you have the options of a longer term?

[daved150]

Re: Question on credit and finance rates

Good night, I could not imagine those kinds of rates. Our car is at 4.5%. If it was me, I would pay as much as you can extra each month to pay down the principle. It really shouldn't take more than 12 months of making your payments on time to boost your score. If you are paying down the principle each month and pay on time, youshould be able to get a new loan in a little over 12 months. But, just to warn you, because this is a new loan you score will drop before it goes up. It has to do with the rating system. They (the credit bureaus) put a lot of weight on the lentgh of the lines of trade (or your loans). For example, last year I refinanced my house and bought a condo for an investment property. Well, about 3 months later my score dropped about 20 points because both the loans were so short. After about 12 months of establishing a payment history, I wont get dinged for the short time period any more. Which leads me to another point. If you have multiple credit cards and you want to switch them to a 0% apr intor card you should do all of them at the same time. This way, they all become 'new' lines of trade at the same time. If you do one, then wait and do another, then wait and do another, you may fail to qualify for the last one because the 'new' loans could ding your score.

I've been in your shoes. My credit was soooooo bad at one point I could not even get a checking account. I had to put my paycheck in a savings account and then go get cash and do money orders to pay my bills. That was probably the most embarassing thing in my life. I made sure to never screw up my credit since. It took several years to finally get it where it is now. So, just be smart, pay early, pay extra and get your score up.

very, very good points here (obviously spoken by a brother thats been there)...thats why i asked if you had the choice for a longer term....i know it's a little late now, but if you did...string that phuqer out as long as possible, lower the nut (payment), then double the payment....you'd cut the overall intrest ALOT!!! (not quite half in 1 yrs term, but alot)....

[SpyWizard]

Re: Question on credit and finance rates

http://www.barnone.com/

you can also try your local credit unions..

i'm paying 4.3% on 2 vehicles...