Credit Advice

Have a question? Have advice to share? The combined knowledge and experience of everyone in the Credit Karma community can help you. Enter your question or help others below to get started!

Question

Posted in Auto Loans
Profile Image

Question By
mason8or

0 Contributions
0 People Helped
Should I apply Available funds to CC debt or My down payment to be approved for an auto loan?
I am interested in getting financing for a $20,000 car within the next 1-2 months, I am only 19 so I do not have any long established lines of credit, I also have a roughly 60% debt to credit ratio, I owe $1200 on a credit card, for these reasons my FICO credit score is only 615. I was planning on putting $5,000 down for the car but I am wondering if possibly using $1,000 of that to pay off my CC would raise my chances of being approved and lower my interest rate and APR or if I should just stick to putting $5,000 down and taking my chances on being approved at all, and for a decent interest rate and APR?

Your Credit Scores Should Be Free. And Now They Are.

View your scores and reports anytime.

SIGN UP NOW
All Responses

Result 1-1 of 1Results per page: 5 | 10 | 25Page 1 of 1   Previous | Next
Top Contributor
1884 Contributions
3675 People Helped

With a 615 score,

You'd be hard pressed to get approved for a good loan, even with $5k down. 

You need to pay down your debt to 20% or less.  Your score will rise when you do. You want a score close to 700 for a decent interest rate on an auto loan. Above 720 would be even better. Once your score goes up, Don't jump the gun and rush out and and try and get a loan through a dealership. Your better off going to a Credit Union and Pre-qualifying for a loan   They are in the business of helping you manage your credit. Open a "share" account. Credit union speak for a savings account. Credit Unions are member owned,  you have "shares" in the Credit union. Do it now so that when you need the loan your already a shareholder.   Building a relationship with a Credit Union can serve you well in the long run. They offer lower rates  and can help you get the payments right in your budget. When you go out shopping for a car you will know exactly what you can afford to spend and you can negotiate as if your paying with cash. 

A good credit score takes time to build.  Be patient and learn to manage your credit. It the only number that will effect you for the rest of your life. 

And remember that good credit isn't a matter of how much you have, it's how well you manage it.  

Good luck. 

Result 1-1 of 1Results per page: 5 | 10 | 25Page 1 of 1   Previous | Next

Your Credit Scores Should Be Free. And Now They Are.

View your scores and reports anytime.

SIGN UP NOW

Reply to this Question

Write your response:
Enter Your Comments

The Credit Advice pages of the Site may contain messages submitted by users over whom Credit Karma has no control. Credit Karma cannot guarantee the accuracy, integrity or quality of any such messages. Some users may post messages that are misleading, untrue or offensive. You must bear all risk associated with your use of the Credit Advice pages and should not rely on messages in making (or refraining from making) any specific financial or other decisions.