Can someone explain this???

[fire228]

I filed for Ch. 7 and it was discharged last August. Since then I have 2 credit cards which I use a payoff each month so they carry no balance and also recently bought a new car last month.
My credit score went from a 570 after the Discharge to now a 630.

I have been making all payments on all bills on time, Have no debt now other than my car and doing my best to rebuild credit.

Here is my issue though.....

I make roughly $42,000 a year and with my credit rebuilding I was hoping to get a Motorcycle. I'm a huge motorcycle nut and unfortunately had to give mine up during the Bankruptcy....

I have applied at 2 Credit unions and both have came back and said I was denied due to "Excessive Obligations"....What the hell does that mean?

I have no debt other than my car, payoff my credit card monthly and make all bill payments on time or before, so why am I getting turned down and given the reason as "Excessive Obligations"??

[LadyInTheRed]

Sounds like they think your car payment is enough debt given your income. Either that or some of your discharged creditors are not reporting correctly. Have you reviewed all of your credit reports?

[fire228]

Yes all of my Credit reports look fine.

I had no issue getting a $20,000 Car, but cannot qualify for a $9000 Motorcycle......Hmmmm

[99lawdog99]

For some reason, Motorcycle loans are more difficult to get. I had a friend who sold them and he told me while cars are considered a necessity, motorcycles are considered a luxury. Also, if you get in a wreck with a car, it most likely won't get totaled where as a motorcycle is usually history so the banks don't really like financing them. It's usually done by the company, such as Honda itself.

[IBroke]

(...)payoff my credit card monthly(...)

Did you make sure that your timing on those CC-payments is spot on to reflect a zero or low-balance on your credit-report?

[fire228]

The credit cards have nothing to do with it. They are paid off and if/when I do use them, I pay them off before the bill even comes.
My credit has done nothing but go up since the Discharge.

I just want to know what "Excessive Obligations" are and why this is the reason for being denied. Only debt I have is a car, thats it, so how is that Excessive?

[Pjmax]

Did you ask the CU's what it means?

[fire228]

I did, but apparently they dont know, go figure.

[IBroke]

The credit cards have nothing to do with it. They are paid off and if/when I do use them, I pay them off before the bill even comes.
My credit has done nothing but go up since the Discharge.

I just want to know what "Excessive Obligations" are and why this is the reason for being denied. Only debt I have is a car, thats it, so how is that Excessive?

Well, in that case I can only guess that they would consider an additional loan as "excessive" - not what you currently have. They also have in mind that your discharge was less than a year ago.

[LadyInTheRed]

Yes all of my Credit reports look fine.

I had no issue getting a $20,000 Car, but cannot qualify for a $9000 Motorcycle......Hmmmm

Maybe you should take this as a sign that you should reconsider getting further into debt for something you want but don't need. Figure out what the payments would be on the motorcycle and start putting that amount in savings until you can pay cash. You are talking about having debt in excess of 50% of your gross income. Not a good idea. Even having $20K in debt is high for somebody with your income.

[Arbyone]

I feel that you may be a bit extended you claim that you have a $20,000 car loan, but you don't state your cc credit lines . if they were $1,000 each you have your reason, with a total amount of credit is more than 50% of gross annual pay of $42,000. Sorry, try to save some money and make a larger down payment for the bike and maybe it may be approved.

[TXskyblue]

Maybe you should take this as a sign that you should reconsider getting further into debt for something you want but don't need. Figure out what the payments would be on the motorcycle and start putting that amount in savings until you can pay cash. You are talking about having debt in excess of 50% of your gross income. Not a good idea. Even having $20K in debt is high for somebody with your income.

I don't want to beat on the OP, but I agree.

I also like to ride motorcycles and really want another one. I could try to get it financed, but that kind of thinking is what lead me down my path to bankruptcy. I have zero intention of getting new debt. I'm still paying off a house and a car. That's plenty enough debt for me.

Once I have the cash saved up, I'll buy another motorcycle. Until then, I can't afford it.