Did you recently take on (or consider) a loan of 84 months or longer on a car purchase?
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I have a new question for you now...and for all those out there who make cash tips in the restaurant industry...
I see from reading this forum that many lenders require proof of income...but what do you do if you make all of your income in CASH tips???
In most restaurants I have worked in, they always underdeclare your income....including my last job of 4 years working as a bartender.
I'd say I make about $40,000 a year in tips more or less. But my W2 forms for the last 4 years show my income to be anywhere from $18,000-22,000. (completely inaccurate)
It's impossible to answer the question: "what is your monthly income?", because it changes by the day, depending on how busy the restaurant is, and how generous people tip you.
Yes, I already quit my job, and when I move to Los Angeles, I will also be working as a bartender in the restaurant industry (while also pursuing my acting career.
So, my question is.....how can I explain to lenders that I actually make a lot more than what my W2 forms say???
I also never receive pay stubs or checks from my employer as well. Many small bars and restaurants operate this way. I know that in large corporate run restaurants, you receive a weekly paycheck. I don't. I only take home what I generate in tips.
Whether I apply now, or later, I feel like my chances of getting a good loan are pretty low, despite my very good credit rating.
How should I proceed?????
Please respond as soon as you can!!!
Thank you! -nycgrrrl
'11 GMC Sierra 1500; '98 Alfa 156 2.0TS; '08 Maser QP; '67 Coronet R/T; '13 Fiat 500c; '20 S90 T6; '22 MB Sprinter 2500 4x4 diesel; '97 Suzuki R Wagon; '96 Opel Astra; '11 Mini Cooper S
the only problem is, i don't own a car. i would be a first time car buyer. i am going to NEED a car asap in los angeles. if i rent a car for a month, it's going to cost me at least $1000.
if i wait until i get settled and can provide proof of employment, and a valid address....we're talking a month or two at least. i called capital one today, and they said i would have to show a utility bill for proof of residence. so that's already a minimum of one month of waiting!
plus, if i apply for a loan then, and they see i just moved into a new apt, and just started a job 2 weeks ago, isn't that going to hurt my chances of getting a good loan?
it doesn't sound like i have any other options...
oh, i feel like my hands are tied....
if only i had applied for a loan before i quit my job! it's a catch-22 though, because the loan offer is only good for 45 days, and i had to quit in late september to fly to barcelona to be with my husband's family.
i am in barcelona for 3 months, and this is why i have no current employer or valid address. i am in limbo....which makes it virtually impossible to get a loan!!!!
does this mean i have to rent a car for 2 or 3 months???
if so, can anyone recommend an affordable rental car agency that does monthly rentals???
if anyone can help me.....please, i'm begging you to take 2 minutes to give me your wisdom and advice.
thank you!!!!!!!!!!!!!!!!
Well, you can show them your 2004 tax return. I assume you declared your tip income on your 1040 form and paid taxes on it, including the Social Security tax.
Why don't you just buy a used car when you get to California?
'11 GMC Sierra 1500; '98 Alfa 156 2.0TS; '08 Maser QP; '67 Coronet R/T; '13 Fiat 500c; '20 S90 T6; '22 MB Sprinter 2500 4x4 diesel; '97 Suzuki R Wagon; '96 Opel Astra; '11 Mini Cooper S
I did a search and just hit the first site I came to for long-term rentals. Found this carrentalexpress.com site that quoted me less than $500 per month for a Chevy Aveo in LA.
I don't profess to fully understand your situation, but if I've learned one thing from TV (insert tongue-in-cheek icon here), its that aspiring actresses and actors have it really tough. So I'd imagine, if this is true, the job market is tight when it comes to cash gigs like bartending, waitressing, etc. So I'd just hate to see you get under the pressure of a car loan and have things not quite work out as you hoped ... then you are jobless AND have bad credit due to a repo.
'11 GMC Sierra 1500; '98 Alfa 156 2.0TS; '08 Maser QP; '67 Coronet R/T; '13 Fiat 500c; '20 S90 T6; '22 MB Sprinter 2500 4x4 diesel; '97 Suzuki R Wagon; '96 Opel Astra; '11 Mini Cooper S
What will people think of next?
I will definitely check out that car rental website.
I will definitely be looking to buy a used car, but even then, I will need a loan.
My burning question is: do I apply for a loan NOW, and say that i am still working for my last employer, and hope that i will get approved.....
Or do I wait several months, rent a car during that time period, and apply for a loan once I am settled, have a job, and an apt.???
I KNOW that noone is going to recommend that I stretch the truth on a loan application.
But I am curious, am I the only one who is tempted to do so because of my current situation???
Do you think people have been approved for loans in this way?
Or do I have to suck it up, and wait???????????
Does anyone know if Capital One always asks for pay stubs or tax returns?????
Has anyone been in my situation before???
If I do apply now, and they reject me, does that damage my credit score? Will a loan rejection show up on my credit report????
Please respond as soon as you can. I really appreciate your concern about not getting drowned by my loan payments while trying to build a new life.
My husband and I plan to share one car, so at least that way, our loan payments should be manageable.
I look forward to hearing your advice on how to proceed with the loan application.....
Thank you again for reaching out and helping me. This forum is so informative and educational.
-nycgrrrl
I have one somewhat bad suggestion for you. If you have a credit card in good standing with a fairly high limit, you could charge the car. Most dealers won't let you do that, BUT if you have one of those convenience checks from the credit card company, you could use that. Yes, the rate may be high (depends, as i have some fixed cards that are quite low, personally) and it is viewed poorly in credit situations since it is an "unsecured" loan. BUT, in a jam, under certain circumstances, if you can pay it off quickly, it may not be the WORST idea. Its certainly better than lying to obtain a loan. And, really, a $4k-$5k car would serve you just fine for quite some time, so its not all that much to put on a credit card (some people charge TVs that cost more than that).
'11 GMC Sierra 1500; '98 Alfa 156 2.0TS; '08 Maser QP; '67 Coronet R/T; '13 Fiat 500c; '20 S90 T6; '22 MB Sprinter 2500 4x4 diesel; '97 Suzuki R Wagon; '96 Opel Astra; '11 Mini Cooper S
You asked if any others have ever been tempted to do something wrong. Sure we have. Sometimes we have given in to the temptation and now we regret it.
Your situstion is pretty simple. When you get to California, you will need a car. Buy one that you can easily afford.
I could also try to find a higher paying job... but lenders want 6 months at your current job.
any advice would be appreciated
I am looking at leasing a 2006 Dodge Caravan SXT. A local dealership is running a special: Offer price of $20,900 down from MSRP of 23,035. It's a 27-month lease with a dealer quoted residual value of $11,287. I'm looking at putting $1000 down and am being quoted a monthly payment of $252.
As I've been negotiating with the dealership (trying to bring the cap cost down), they are saying 'with how good of a lease offer this is, we've already taken as much as we can off the price' other than an additional $500 and some oil changes I likely can get. Given I'm a car-leasing novice, I'm unsure whether to take their word on this or keep pushing for more.
Any advice and/or comments would be greatly appreciated!
Jay
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I know from research that we got a good buy on the vehicle.
Then we went into the finance room. After a significant downpayment, we remained with $8,179.51 to finance.
The officer plugged all the info into his computer, and told us that it automatically searches for the best offer available, based on various factors.
His computer quoted us a 8.74% interest rate on a 60 month loan. He assured us that was great and we had received it only because we had good credit (my mom has a credit rating of 829, and mine, AFAIK is 803). He said auto loans are often 10%, and we would not get any better than what the computer said.
Today I roamed around the internet, and it said that the national average for a 60 month new car loan is 6.46%. My mom called her bank today, and they offered 7.49%.
I am trying to contact my credit union. Bankrate.com says the rate for Bank of America in our town is 6.29%.
Have we been skunked? What can we do?
We called Mr. Loan Man about this, and he said that if we waited 6 months we could refinance the loan without a $150 penalty.
I think you learned that part of researching a vehicle includes researching financing before you buy?
Maybe you can refinance with Wells Fargo Auto Finance? A Wells Fargo Auto loan, with excellent credit, is 5.84% on a 42-60 month loan. I have an auto loan with Wells at 5.04% for 60 months, which I got back in Dec. 2002, when I only had a FICO score of 726.
Good luck.
Wells Fargo not available in Florida. :-(
Just called my Credit Union and they are offering 4.9% (LESS if our credit scores are over 740, which they are!)
So instead of paying $1,946 in interest over 5 years, we would pay only $1059!!!
That's a difference of $887! (and our loan was for less than $9,000 - think what the savings would be if it were a $20,000 loan?)
We are going over to the car dealership this afternoon to have a little "chat".
How much recourse do we have since we signed all the papers with them?
Thieves! :sick:
The salesman who sold us the car spoke at length with us. (BTW, if anyone is interested in getting a good deal on a Toyota in SW FL, I have a JEWEL to recommend!)
He was obviously not happy with the way the finance rep treated us. He tried to explain the other side of the story as well as he could, but it was obvious to all of us that he didn't have much of a leg to stand on. However, he did have such a pleasant, honest, compassionate way about him, that he managed to calm me down (no small feat by this point, I might add). He never directed us to speak to the finance rep (just as well). He just suggested we go ahead and take out that loan with the credit union, which we will do (over the course of 5 years this would save us about $1,000).
I am definitely going to write to the manager and explain the circumstances. We will have to pay a $75 fee (rep told us $150, and we'll see about that) because we are refinancing before 6 months is up. Besides being hoodwinked, that fee really grates on me, since it feels like punishment for believing their rep.
When anything else happens, I'll let you know. :confuse:
Dealers make money on the extra interest that they can get on the loans and it sounds like they are trying to keep you from refinancing until they can get credit on the loan.
I had something similar when I bought my truck last March. I got an extra $1000 rebate for financing through GMAC at a high interest rate. I was told that I had to keep the loan for 90 days and then could refinance. The problem was that this was right at the time that the Feds were raising the interest rates and I was worried that I wouldn't get a decent rate if I waited.
I scoured the paperwork and found nothing that indicated any kind of period that I had to have the loan and also found the part in the loan papers that said there was no penalty for paying the loan off early. So, once I got my GMAC account number, I refinanced the loan and never heard anything else about it.
"You may prepay all or part of your Principal Balance at any time. If the contract is paid in full within six months after the date you sign it, we may impose an acquisition charge, not exceeding $75, for services performed on your behalf for processing this contract. If you prepay, you must pay the earned and unpaid part of the Finance Charge and all other amounts due up to the date of your payment."
I also note that the contract includes a "Loan Processing Fee Paid to Seller (Prepaid Finance Charge)" of $100.
So the way I understand it, we pay a Loan Processing Fee of $100, and then will pay $75 for pre-paying?
So we pay $175 for the privilege of being robbed in the first place? :surprise:
Sounds like it. Chalk it up to your life education account.
Sounds like a pretty slimy dealer there. I would never had signed that (or I should say my wife wouldn't have let me sign it - she's the one that reads those things :sick: ).
Next time, be sure to get preapproved for financing before looking at cars.
WHAT next time?
I'm about 50, never had a new car (or anything close) in my life.
We intend this car to last us for a long long time (my mom is 76, and I'm guessing this is the last car she will have).
I would have never been able to get this car without purchasing jointly with her.
I highly doubt I will ever be able to have a new car after this.
All this just makes me want to
In any confrontation, the goal is to make your adversary more miserable than they make you. That is one of the cardinal rules that I live by in my life.
If the dealer is going to charge you $175 or so to re-finance your loan, then try to make them miserable. Go to the owner's office and complain and whine, wear ratty old smelly clothes, make bodily noises, bring along some dirty young people to hang around the showroom while you are talking to the owner. Have gease and grime on your shoes and track it onto their carpet. Be creative!
Don't fight fire with fire - fight fire with a holocaust! Yes, that is another one of my original sayings.
In short, there are a lot of things you can do to make them wish they never met you. And have fun doing it!
Bob
I don't know the whole story here.... but it sounds as though this is the bank's contract, not the dealer's. If it is the loan contract, then the dealer is doing nothing shady.
It's disgusting that they can legally lie and steal. I'm glad though that you can at least refinance for a better deal.
Good luck.
I just read the posters story twice...where did they lie and steal? did I miss something?
If bipwop takes my advice, the dealer will wish they had treated him better. Much better!
Like John Kennedy said, "Don't get mad. Get even."
Any honest car dealer knows that a credit score above 800 is excellent and qualifies for the best financing rate. That dealer's computer spit out 8.74% for two credit scores above 800? Give me a break!
You can have all the 800 scores in the world .. but like one of my golf buddies, he has two Visa cards one with a 13% rate and another with a 17% rate .. now, I've mentioned on a few occasions he can have them both lowered to probably 9% ... but, he'll get around that when he finds the time -- that was 2 years ago ....
Nobody was "skunked" here ... it's a business, not the Salvation Army ... if a buyer goes into a furniture store and pays $1,900 for a dining room set (which happens every second of everyday) when he could have bought it with a few shopping hours invested for $1,400, then you can't blame the furniture store -- it's a business ... if a buyer drops into a golf shop and pays $349 for that new driver (which happens every second of everyday) when he could have invested a few shopping hours and found one $249, then you can't blame the golf shop -- it's a business ....
The g/f and I take a few trips a year ... the couple sitting on our right side of the table have paid $3,800 for the cruise, and the folks to our left have paid $2,500 (which happens every second of everyday) you certainly can't blame the Travel Agent - it's business ....
You want to be a smart shopper.? .. then spend a little time and look around and see what the market will bare .. instead of paying $9,500 in closing costs on a $250,000 house and getting a 6.5% interest rate (which happens every second of everyday) look and see what's going on in and around you ... finger pointing is a wonderful thing, ever think about pointing the finger in the right direction.? -- that direction is called ~ Responsibility .... try it, you might like it ...
Terry.
Although I think it’s lying and stealing, not “business,” I still did my homework on car pricing and financing to try and detect the lies and eliminate being stolen from when I purchased my car. I certainly didn’t have to, in my opinion, lower my values by calling it "business" when three of four car dealers lied and tried to steal from me.
Thanks.
The dealer told us that the computer would search for the BEST OFFER AVAILABLE. **LIE**
He assured us that 8.74% was a great deal **LIE**
He told us that the ONLY reason we got such a GREAT deal was because we had such great credit scores. **LIE**
We questioned the interest rate, and he told us that if we went else where, loans would be up to 10%. **LIE**
He told us we would not get any better rate than what the computer said. **LIE**
Later, when we told him we wanted to refinance, he told us that there would be a $150 fee for prepayment. **LIE** (When we looked at the paper, it said the fee was "not to exceed $75". I believe he was trying to discourage us from dumping his loan.)
Our own bank, without checking any computer, told us that car loan rates almost always are between 6.9% and 8.4%, and that our loan would be less than 6.9% because we had top tier credit scores.
My credit union told us the loan would be less than 4.9%.
So, the difference between his loan and my credit union's loan amounts to about $1,000 over 5 years. **THIEVERY**
I know we didn't shop around. We didn't think we had to. We thought he would tell the truth. We really thought we were getting a great deal.
The dealer charged us a $100 fee for processing this "great deal". **THIEVERY**
Hello??? When did they NOT lie and steal?
I must add that the car part of the transaction was totally on the up-and-up. The salesperson was completely honest with us (and I had done a lot of homework on buying this car). I know "honest car salesman" is an oxymoron, but he really was.
Oh, I forgot to mention this: When we were talking to this wonderful finance rep, he was speaking rapid-fire. My 76-year-old mother asked him to slow down because she was having a hard time following him (just what he wanted). He replied that it was late New Year's Eve and he had a wife at home waiting for him. OK, so let's add **UNPROFESSIONALISM** and **RUDENESS**! :mad:
Two things kinda struck me funny from one of your first posts ...
>>1.) "I'm about 50 ... "
>>2.) "I would have never been able to get this car without purchasing jointly with her..."
Something tells me there is some sort of credit restriction here - or you wouldn't have needed your 74 year old Mom on the paperwork ... so we really don't know what went on in the Finance department, do we.?
I'm not trying to be smart or pick on ya ... but at age 50 you should now that interest rates vary from state to state and county to county and city to city .. with you living in Florida you should be aware that rates are cheaper here then say perhaps in Columbus Ohio, especially on mortgages .. so if someone "feels" they deserve a better rate than normal, then they need to go shop that rate and it's your responsibility to do so .. it's just business, nothing personal ..
I just had some minor surgery last week .. but before I did, I visited 3 different doctor's - I figured their opinion would be better than my Vetenarian .l.o.l... with all of the hurricane damage down here in Florida you can bet I called more than one roofer, you know that's a good thing when the prices varied from $21,000 to $35,000 .. that said, quality first and price second, but I certainly wasn't mad at the highest bidder .. it's business, there's nothing personal about it ...
That example I used with the $250,000 house.? .. that's a real deal, that's my 27 year old nephew, he's a graduate of Duke University - and tops in his class .... when he started looking for a house back in September we spoke many times on rate, closing costs, origination fee's, construction quality, lenders, points, term ~ "the whole Coma se' Yama" .... he closed on the 30th, he ended up paying $2,000 too much in points and orgination fee's, $5,000 too much in closing costs and the rate by Country Wide was point higher than market .. that's about $72,000 more then the prevailing programs on a 30 year fixed - if held to term ...
Did he get "skunked", "ripped off", "taken for a ride", lied too, were they rude and unprofessional .? - *Nope* .. it's just business - nothing personal ... he just paid too much, now he feels he's been ripped off and blames Country Wide ..l.o.l.. ....... He had dozens of options, he as all the resources, he has the education, he has a computer and he has family that has bought "many" major items before ... what he doesn't have is ~~ responsibility ..... it's like lookin' in a mirror, ain't it .??
aaaah, yes .... finger pointing, how convenient .....
Terry
When you lease a car, negotiating the purchase price for it should be just like negotiating the price as if you were going to buy it, right? Ie, one should expect the same cash back rebates offered to the public to apply to both the negotiated lease purchase price and a regular negotiated purchase price?
Ford is currently offering a lease on an 06 Escape that I might be interested in. My local dealershup is telling me that the net capitalized cost for the lease is simply MSRP minus X-plan pricing minus a $1000 offer for financing the lease through FMC. I think the $1500 plain cash back rebate should apply here, too, or to any lease. Am I right?
thanks!
Charlotte
Didn't he also say: "get the secretaries and Marilyn off the pool tables before Jackie comes home" ....?
Terry. :P
Terry.
First, YES, you should negotiate the purchase price just as you would if you were purchasing the vehicle. When you lease, you're basically financing the difference between the purchase price and the residual value, so you obviously want to get the best possible deal on the purchase price.
Second, you should hit the discussion called Ford Escape: Lease Questions for advice specifice to that vehicle. Good luck!
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There is a little twist...if the dealer puts the lease thru a lease company other than the mfg. (like chase, first 3rd bank, etc) they can claim the retail purchase rebate...but in most cases it's still less $$$ to go thru the mfg.
Also, when you lease, does everyone get the same 1.5% rate? I would have thought the rate was based on your credit rating. Is it standard?
Why are you not surprised I live in Port Charlotte?
When I said I would have never been able to purchase this car without purchasing jointly with her, I was referring to finances, not financing. Rather than have 2 old cars (which we did), we decided to own one new car together. Neither one of us was in a financial position to buy a new car alone. We bought the car together, and financed it together.
There is no problem with my credit score of 803. I am applying for the refinancing in my name, with my mom on it as well, since we both own the car.
Yes, I'm 50, even Wesleyan University (Conn) graduate. Have lived in Kansas almost the last two decades, where you leave your cars (and often houses) unlocked, and you can trust people. (Why in the world am I telling you all this?) Neither one of us have family members who would have alerted us to loan scams. Both of us live pretty sheltered lives. We had no idea that we had "dozens of options", even though you are sure we should have known better.
Interest rates may vary, but we were told that we were getting the absolute best deal available to us anywhere. And the rate they gave us was anything BUT normal!
I don't see how you can read my previous post and state that they did not lie.
Responsibility? I'm afraid I believe people have the responsibility to tell the truth.
Apparently in this morally bankrupt nation that should not be expected.
Wow, I believe people can do business AND be honest - how audacious of me!
Oh, and BTW, we *did* shop around for roofers after Charley. We think we got a good deal (recommended, reasonable price) but I guess we'll find out when the next major hurricane comes along! :shades:
Please bear in mind that interest rates are not based upon your credit score alone. Many other factors need to be taken into consideration. I don't know what bank you are dealing with or what their requirements are but some of the factors include:
Percent down
Total amount financed
Previous credit history
Previous car loan history
Single or joint credit
Homeowner or renter
Debt to income ratio
Payment to income ratio
Loan term
Time on the job
Time at address
Type of car purchased
Prime rate
I could go on, but I think you might be seeing what I'm talking about here. Now I am not saying that you had all of these factors affecting you. Once again, I don't know what bank we're dealing with, but an 800 credit score doesn't guarantee everything. There are a lot of college students with deferred loans and maybe a $500 credit card that have 800 credit scores, but can't finance a new car.
Credit unions make up their own rules. They are not a bank. They do not borrow money from the federal reserve, they borrow it from their members. That gives them the flexibility to offer rates that are sometimes lower than what you can get from a dealer. Also it is the bank charging you a penalty to pay off your loan, not the dealer. Could they have handled your situation better? It sounds like it, but they weren't stealing.
By the way, we are human and many of us have families. The fact that your finance person was in a rush to go home is understandable on New Year's Eve. This is a good business, but it takes its toll on time spent with your family. If you don't want to be rushed through the process, shop around noon on a Tuesday afternoon. The dealer will probably be much more patient with you then.
When I added that we had good credit, she told us that it WOULD be BELOW 6.9%. This loan officer did not even know our names when she gave us this quote in person. She did NOT ask anything about Percent down, Total amount financed, Previous credit history, Previous car loan history, Single or joint credit, Homeowner or renter, Debt to income ratio, Payment to income ratio, Loan term, Time on the job, Time at address, Type of car purchased, Prime rate.... She knew where interest rates fell, and from previous car loan experience, she knew where our interest rate would be.
Do you know that the national average for a car loan is 6.46%?
Do you know how EASY it would be to find a loan in our area at a BETTER rate? I plugged in our zip code in a website, and zoom! there were rates in Port Charlotte of 6.29% and 7.00% (our bank). I searched many places on the internet for car loans (both brick-and-mortar and online) and it was HARD to find anything above 8%. So his magic computer, after searching "all over", for the "very best rate available to us", comes up with 8.74%?
You've got to be kidding. It would be hard to find a rate THAT HIGH!!
The credit union figure was a flat rate, given to anyone who was a member. It would only change for the better with a good credit score.
Someone on this thread said "The Wall Street Journal Prime Rate is 7.25% right now, and the best banks are offering in the upper 5's for super-primo credit."
I don't have a problem with people making money. I do have a problem with people lying. I also object to the amount of profit he was trying to get off of us. We would pay 100% more interest over 5 years with his deal than by going through our bank. (Much more than that if we went through our credit union.)
I have been a professional for over 20 years. Having someone at home waiting for me would not pass as an excuse (unless they were sick or there were some kind of emergency). Professionalism includes patience, especially when the client is being completely courteous. We ARRIVED early in the afternoon. It was between 7:00 and 8:00 when we finished, and ours was not a complicated transaction. Stock car, price established before appearance. The dealership knew that there would be a lot of customers on the last day of the year, especially with their aggressive end-of-the-year sales. They had a commitment to staying open "till the last customer served" (not "till the last customer rushed through" and to treating their customers right. That does not include refusing a polite request to slow down extremely rapid patter that an old lady was having a hard time following (I'm "only" 50 and I was having a hard time).
MAYBE "understandable" but certainly NOT "excusable".
Nah, it wouldn't be that hard. You found that rate pretty easily.
"I do have a problem with people lying."
No one cares about your problems.
"the national average for a car loan is 6.46%"
For someone who will never again buy a new car, you sure are doing a lot of research.
Funny how the owners had more scruples than their employees!
The Sandman