Need a new car, but scared to try and use my credit.

[flhx1550]

I currently have a vehicle, and though it is not on it's last leg, the timing is right to send it down the road (2006 Silverado 4wd with 120,000 on it). The truck is pretty much a wash as to what I owe vs. what it is worth.

I went thru Chp. 7 last year, my hearing was on Aug 7th, I was discharged on Oct 10th. Other than obtaining a $400 Credit Card, I havn't used my credit since the discharge.

That being said, I am nervous about using my credit for a larger purchase. My credit score is 640 (638, 641, 647). The timing is good on the vehicle I want to purchase (incentives and rebate) but what I am afraid of is trying to finance at the dealer and getting denied, with the credit inquiries being wasted on denials.

I do see several on the forums that are happy with Capitol One Auto, but I do not think they are an option as I had a Captiol One Credit Card as part of my Chapter 7.

I understand I will pay higher rates, but with the average in my area at 7-8%, is "higher" 10,12 or 20%?

Should I skip on the dealer getting my financing, or should I do it myself? I am fortunate that my brother-in-law owns the car dealership, so the "funny buisiness" stuff with buying a car is thrown out the window, and they are pretty strait up front with me.

I do belong to a credit union, but they will not consider a loan until a year after the discharge.

[chicagoannie]

I don't have any advice for you, but please update when you move forward with your auto purchase. I have an '02 F150 with 140K miles on it and will be car-shopping once I am employed again (truck is starting to have expensive repairs needed.) I do plan on purchasing something used but with some warranty left on it, although I have heard that a savvy new-car purchaser can do better $$$-wise buying new, in some cases.

[flhx1550]

Over 100 views, but no advice?

[Maddie]

A lot of people posting have gotten decent deals through a Dealer. Snce you have family that own a Dealership, defintely talk to them. I was approved through Cap One but Hubby was not (he had a cc discharged through them). Some have been approved through Road Loans too, but a higher interest.

Good luck and keep us posted.

[clevelandmom]

Hi flhx,
Did you read my story? Don't be afraid. I wouldn't try to get the loan on your own first (just my opinion). We were attempting to redeem our car, and were going through the 722 redemption process. As of this past Monday, Ford and US Bank did not come to a deal yet between what the car was worth, and the amount of the loan they would give us. The only thing I knew for sure was that US Bank was giving us a 24% interest rate. Ouch. I knew in my gut we could do better. . .

Fast forward to this past Thursday. We went to a used dealership that also has new cars. We made an appointment to speak with the finance guy. We wanted to completely skip the sales guy because we wanted to know what kind of interest rate/loan we could get before we even looked. Our credit scores were worse than yours! Here's what we ended up with:

A brand new 2011 Dodge Caliber - $19,000 (and change) - ZERO, ZERO, ZERO interest!! 5 year loan - 7 year warranty, $1,000 down. (did I mention it was zero interest?)

I believe the car dealerships are in major competition with each other. They have aces in their pockets that work at the banks and are friendly enough with certain buyers to get the deal done. I actually watched it happen. If you just call a bank and ask them for a blank check (with a decent interest rate) I just don't think you're going to get it. These are banks, after all. They'll screw you every chance they get.

All the above being said, I would check ALL your options before you settle on anything, and do NOT let fear get in your way of looking at every option. You're afraid to walk into a dealership, but don't be. You just might find that you will receive a FAR better deal than calling a bank. But make it easier on yourself and call the finance guy and make an appointment. The worst thing they can say is no, you don't qualify (which I highly doubt will happen). Best of luck!

[JGra]

Can i ask what dealership you went to? i'm in KY but would drive up there if I could get a deal like that I was discharged one day before you. I keep gettin jerked around pretty bad by dealers around here