Capital One Auto Questions

[Kuya]

I plan on applying to Capital One Auto in a few weeks. I am waiting for one thing to happen:

My Bk13 is complete, just waiting for Pacer to show the Judge signed the final discharge and then the big 3 credit bureaus update.

My credit score is 670 (Experian) 667(Transuion) & my TransUnion Auto score shows as 637 (according to creditKarma.com). I make over 60k year, which can be verified.

The car I want is $34,000, and I want to find a lower rate interest loan for 60 months, and put a large downpayment down (amount will depend on what rate I get, I will put enough down to keep my payments within my allotted budget amount).

So, here is my main question:

If I apply for $34,000 Cap One . . and they deny it, will they counter with a lower amount, or will they just deny it? Seems a lot of people get approved for 25k and 30k. So, maybe 34k is too high to ask for? Maybe I should request 30k? rather than risk getting denied?

Has anyone had an experience where they approved for a certain amount and got rejected, but offered a lower amount? All I have read, so far, is people that asked for a lower amount and got approved for more than they asked originally.

Thanks for your insight.

Really, I am looking to get pre approved by Cap One for the full amount of $34,000. Then, I plan on using that as leverage so that the Dealer works to beat that rate. Then I will take the new offer, and put $9,000 down and stop them from beating me up.

[LSUTiger32]

Aye carumba.

[mikemike]

Im sort of in the same boat as u. The car i want is about 25k. I get pre-approvals all the time from capone and i tried applying for the blank check and got denied twice. Now wat i realized is im putting about 8k down and there was no way of them knowing that when i applied in which i know would have helped me if they had known. In reality i wanted only about 15k and ill put the rest. But the 1st time i applied i went for 25k and the second i tried 15k and still got denied. I decided to wait till april to go to the dealer and try with them better. Online didnt work for me :-(...Hope that helped a little

[Kuya]

Aye carumba.

Your "Aye carumba" is judgmental, it is unwelcome and certainly not productive.

1. Not all people file a BK due to irresponsible spending. When I filed, I was making 22k/salary(before taxes) living on my own struggling to make it. I had a 6 year old pontiac with (obviously) no warranty and I was living from paycheck to paycheck wondering if I had enough money for gas to get to work. On payday I would go through the Wendy's Drive-Thru and get $20 worth of the $1 Chili cups and go home and put them in the freezer. That was dinners. My car went in for repairs with a transmission problem and cracked manifold. Cost of repairs? $4300. I had no savings in the bank and I needed my car to get to work. So, I did the only thing I could think of. I took my rent, food, and bill money and paid to get my car fixed . . . and then I financially fell on my ass. Small bills became compounded with interest and late fees . which turned into additional over the limit fees. I had one Chase credit card with a $1200 limit. By the time they were done with me (forcing me up to 29.9% interest, late fees, over limit fees), my account was up to almost $5,000. I could not come out of the hole. $20/month min payments were now $500/month. You don't make the min $500/month payment, you get slammed with more late fees, more finance charges . . . more penalties...
About 14 months later, I went to an attorney (after first trying credit counseling) and I filed a Chapter 13. All of my creditors/bills were willing to work with me, and were actually very understanding .. . except Chase Bank. They were bull dogs. When I tried to make arrangements to get up to date with them (and I did try very hard) they refused, demanding full payment - or garnishment. I filed 13. NOT 7!!! Silly me for thinking it would feel better to make every effort to pay my debts.

2. 3 months after filing, my work finally promoted me to over $60,000 year. Although I never knew what it felt like to make that kind of money, because my Trustee stepped in before the first paycheck arrived.

3. Remember . . . my car was 6 years old and no warranty. Guess what? I am forced to keep it for the next 5 years. Unlike many people, I did not run out and buy a new car just before filing BK. So, if you are wondering why I will not EVER buy a car without a warranty again . . .or buy some "extended warranty" where I have to fight for everything and still pay . . . maybe you will better understand now. I filed CHAPTER !3!! That means my car is now 11 years old . . the same car that put me in this mess.

4. Why am I buying a $33,000 car? Because I make decent money and I have no bills, no children and no obligations. Chapter 13 (at least for me) was not like going to rehab! I am not a drug or a spending addict. I have every right to live my life within my means.

5. I am also putting down $7,000 - $10,000 cash. So in fact, I will be maybe financing a car in the low to mid 20's range . . which is what most people end up buying.

6. Why brand new? Well, please refer to the story that put me into this mess! But also, when you have a BK on your record . . you have a much better chance of obtaining lower financing rates on new cars. Many dealer financing (like GMAC) offer 1.9 or 2.9% for 60 months on a new car if credit qualified. Well . . .they can also QUALIFY you, even with bad credit if they want to sell you a car. Dealer banks are created to help dealers sell a quota from the manufacturer during slow times.

My goal is to get pre-approved from cap one for 8 to 11%. Use that as leverage to somehow get the special incentive of 2.9%, take the low rate loan, drop 7-10 thousand dollars down and have a nice car.

You are very quick to judge me and you don't even know me or my situation. It is just a guess (and I very well may be wrong). . but I am guessing you filed Chapter 7??? The reason I say that is because it seems that often when people speak of running out to buy a car right after a BK closes . . . the Chapter 7 "authorities" jump in and scold them.

Keep in mind that we chapter 13's paid back a large amount of our debts. We suffered in hell for 5 years (5.5 by the time all the paperwork is done). Many of us went into 13 with a 5 or 6 year old car. We can't get any type of loan until HELL FREEZES over and the chapter 13 is discharged 5 years later. So, yes . . by the time we are discharged, and our car is rusty and 12 years old, and a money pit . .YES YES YES . . . . we are looking and dreaming of the day . . where we have a car with a factory warranty.

[Kuya]

Im sort of in the same boat as u. The car i want is about 25k. I get pre-approvals all the time from capone and i tried applying for the blank check and got denied twice. Now wat i realized is im putting about 8k down and there was no way of them knowing that when i applied in which i know would have helped me if they had known. In reality i wanted only about 15k and ill put the rest. But the 1st time i applied i went for 25k and the second i tried 15k and still got denied. I decided to wait till april to go to the dealer and try with them better. Online didnt work for me :-(...Hope that helped a little

MikeMike,

I am willing to bet that a dealer can finance you. From the research that I have done, and talked to many many dealerships about my situation . . they are often willing to work with you if you have substantial cash down. If you are putting $8,000 down, you will probably be ok. Many Dealers have special "connections" to banks that offer financing to those of us with "less than perfect" credit. The hurtles you will run into, are possibly higher interest rates (although you will find lower rates with bad credit if you opt for a new or certified used car - rather than used) and shorter loan terms. Some banks will only go 48 months for bad credit loans. BUT . . . if you can find a dealership that needs to make their factory quota during a slow month - you can bet your apples that they will magically get you approved at a decent rate through their own bank. Of course, when the dealer is doing well, they will have less power with the home banks.

As far as Cap one is concerned . . . . MAKE SURE that all 3 of your credit bureaus are showing your BK as discharged, and your old history is cleaned up. For example, I had noticed that a few of my creditors were showing me as derogatory or "behind" and one even showed me as in "collections" even though they had been paid in full by the BK. It took me about a month to get it all cleaned up, but now I have a nice clean credit reports with the big 3. The only negative thing on my report at all is the BK.

I spoke to a Cap One Auto Loan agent on the phone. He informed me that two of the most important things are to not have any current items listed as "in collections", "missed or behind payments", or large balance dues. So clean those up if your credit report is not accurate. He also said that they check ALL 3 Bureaus, and if any one of them does not yet show the BK as discharged, you will automatically get denied for a loan. No exceptions.

Good luck.

[LSUTiger32]

So let me get this straight. You were in the position of buying 20 freaking Wendy chilis at a time to eat and your answer after filing BK is to buy a Escalade? You do not need a $35,000 car to get around. Obviously, that $4,300 was well worth it if the car has lasted you 5 more years. That's the best deal you've ever done. Do whatever you want there buddy, but a $700 car payment isn't going to help you.....as a matter of fact it's likely to put you back in the same position. Good luck with it, hope you enjoy that car.....a lot. You're gonna need those good memories.

[LSUTiger32]

You are very quick to judge me and you don't even know me or my situation. It is just a guess (and I very well may be wrong). . but I am guessing you filed Chapter 7??? The reason I say that is because it seems that often when people speak of running out to buy a car right after a BK closes . . . the Chapter 7 "authorities" jump in and scold them.

Keep in mind that we chapter 13's paid back a large amount of our debts. We suffered in hell for 5 years (5.5 by the time all the paperwork is done). Many of us went into 13 with a 5 or 6 year old car. We can't get any type of loan until HELL FREEZES over and the chapter 13 is discharged 5 years later. So, yes . . by the time we are discharged, and our car is rusty and 12 years old, and a money pit . .YES YES YES . . . . we are looking and dreaming of the day . . where we have a car with a factory warranty.

Yes, I filed CH7. It's not my problem that you had an idiot for an attorney or you had assets that prevented you from doing a CH7. There was a reason for it, believe me you would have done a 7 also if you could have. For your information, I bought a car FOR CASH. One of these RUST BUCKETS you speak of. That was almost three years ago and get this, it still runs perfectly and without a warranty. I learned my lesson, I won't get myself back into the same situation. If you think a $35,000 car with a $60,000 salary is "living within your means" then you learned nothing. I make way more than $60,000 and there is no way I would have bought or will buy a $35,000 car right now......unless of course I paid cash for it. Just wondering what your plan is if that salary gets reduced or you lose your job. You might want to check into this wonderful economy we are living in right now.

What I find even more funny is that you are doing this in the name of "a car with a factory warranty." You gonna buy a new car every two years when the lousy 36,000 mile warranty runs out or do you plan on letting them rip you off some more with an extended warranty?

[Kuya]

I am very sorry. You are 100% correct. You have been through a Chapter 7. I know how difficult that must have been for you . . getting to walk away from your debt and pay not a single penny back. It must have been traumatic. I did not mean to question your authority. You filled out some papers, waited about 3 months and then you were free and clear. What a horrible horrible experience. Your credit shot to the toilet. And you could not start rebuilding it for 3 whole months. You must of been dying inside.

You call my attorney an idiot because I paid back most of my debts. You are right. What a fools me and my attorney were. We took the easy road, paying most of it back over 5 long years . . . What schmucks we were.

Thanks for shedding some light . . you have completely changed my perspective. I will certainly consider your advice.

Thanks for your time

[LSUTiger32]

I am very sorry. You are 100% correct. You have been through a Chapter 7. I know how difficult that must have been for you . . getting to walk away from your debt and pay not a single penny back. It must have been traumatic. I did not mean to question your authority. You filled out some papers, waited about 3 months and then you were free and clear. What a horrible horrible experience. Your credit shot to the toilet. And you could not start rebuilding it for 3 whole months. You must of been dying inside.

You call my attorney an idiot because I paid back most of my debts. You are right. What a fools me and my attorney were. We took the easy road, paying most of it back over 5 long years . . . What schmucks we were.

Thanks for shedding some light . . you have completely changed my perspective. I will certainly consider your advice.

Thanks for your time

LOL! Yeah CH13 does wonders for your credit! Thanks.....glad I could change your mind. Is this serious? Yeah dude, you are a freaking hero for filing a 13 and paying those payments. Enjoy that chili!!!!!

[justbroke]

Everyone's situation is different and I did start in a Chapter 13 myself and convert to a Chapter 7. I think the point that's being missed here, due to the underlying tone, is that a $35,000 car even for myself (and I gross 5 times that), is not even a consideration! I'm looking at cars that are used and $15K - $20K. I don't want a payment over $400/month, and I take home 5 figures a month.

So to both Tiger and Kuya, you are both right and both wrong. How's that for diplomatic.

I will add that Kuya, good for you to put money down on the vehicle, but I still think the downpayment (of $7-$10K) is a waste, as that money will be gone as soon as you drive that car off the lot. You can actually buy a certified used car that is a model year or two old! Then invest $700 on a bumper-to-bumper warranty extension from the manufacturer, if the other warranty hasn't already expired.

There is more than one way to have a reliable car that has a warranty, without losing $10K after driving it off the lot.

[Meatstick]

You can also buy a Hyundai Accent in the $10k - $15k range depending on having a manual or automatic transmission. These cars come with a 10yr/100,000 mile warranty. Your payment is likely to be in the $200-$300 range and that's not bad at all for a car that gets very good ratings and gas mileage.

Just a thought and worth looking into.

[LSUTiger32]

Good point Meatstick......I refuse to take another car payment the rest of my life but if you feel it to be necessary certainly can do better than a $700 car payment. It's just insanity. I am not saying it to be a jerk, but you can't win making $60K and buying a $35K car.

[Kuya]

I do appreciate your diplomacy!

You are also correct that I am looking to purchase a car that is one year old. To be straight, it is a 2010 Cadillac SRX for $32,000. Tax will be around $2,500. I sold my previous car for $7,000 and $2,000 return from the Trustee for overpay. I will be adding another $1,000 cash to make $10,000. So in essence, I will be financing about $20,000. My payment will be based on interest rate . . . but I am pushing to get the 2.9% incentive. Anything above 6% and I will walk.

For me: I make more than some and less than others - that's not the point. I live in a 2 income home with shared expenses. My cost of living is VERY low. Could I spend my money more wisely? Maybe. But, I like cars. I have almost no bills, and decent income.

Although I do appreciate everyone attempting to tell me what I can and can not afford, without even knowing my monthly expenses, so let me help you out:

Rent: $450 (half of $900)
Elec: $35 (half of $70)
Cable/Internet: $55 (half of $110)
food: $250 (half of $500)
gas: $180
car insurance: $125

That's about it for me. So, let's see . . . that's about $970.00/monthly. Income is $2932/monthly AFTER TAXES. That's not counting the two months a year, there are Three pay checks for me . . .

So, in a nutshell, My spendable income after all of my current expenses is $2000. So, even if my car is $500/month (but I am really shooting for a low interest rate and keeping it at about $450/month) . . . that's still $1,500 to save, and take care of unexpected events each month.

Please, everyone, stop telling me what I can afford and what I can not. I agree, that buying a luxury vehicle is not for everyone. I agree that there are better ways to spend money or save money. But this is what I love. Please stop telling me what I can and can't afford.

Thank you for your suggestions. Some of them will be useful. Others are respectfully put aside.

Everyone's situation is different and I did start in a Chapter 13 myself and convert to a Chapter 7. I think the point that's being missed here, due to the underlying tone, is that a $35,000 car even for myself (and I gross 5 times that), is not even a consideration! I'm looking at cars that are used and $15K - $20K. I don't want a payment over $400/month, and I take home 5 figures a month.

So to both Tiger and Kuya, you are both right and both wrong. How's that for diplomatic.

I will add that Kuya, good for you to put money down on the vehicle, but I still think the downpayment (of $7-$10K) is a waste, as that money will be gone as soon as you drive that car off the lot. You can actually buy a certified used car that is a model year or two old! Then invest $700 on a bumper-to-bumper warranty extension from the manufacturer, if the other warranty hasn't already expired.

There is more than one way to have a reliable car that has a warranty, without losing $10K after driving it off the lot.

[liboton21]

Kuya,

Why don't you buy just an economical used 2008 - 2010 cars instead of a 35K gas guzzlers car? I was six months from my closed BK when my Land Rover started to breakdown and spending almost 5K to replace a used engine. I love those Rovers but with 4 kids I opted to bought a used mini-van (Dodge 2008) with low mileage from Toyota with Americredit loan of 17% interest. I will refi in six mos thru capone. Wow...$20.00 for a dinner. Guess, beats a $20.00 pork adobo with rice for dinner.

Tatay

[Kuya]

Put a fork in me - I'm Done