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      02-14-2014, 01:54 PM   #1
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Question FINANCING Obstacles - newbie to US

Hello guys,

I am a South African forum member and have relocated to the US just over a year ago. I used to own a E60 5 series and before my arrival a beautiful Space Grey E92 M3. I was very sad to part with it, but RH drive import to the US was not an option!

Anyways - like a proper addict, I'm constantly trawling sites for my next baby - however whenever i find a car - and want to finance it, I get the finger from the banks.

I am getting to grips with the US credit rating system..and although its taking me a long time, I'm slowly building up my credit score.

I have 3 questions that i hope someone with credible knowledge can assist me with:

1 - does anyone have experience with banks / dealerships that actually provide finance for individuals who are building their credit history. I'm currently on 660. What baffles me is that i earn a good salary..close to 180k/annum and i have already a home mortgage - but when it comes to auto - i cant get any help!

2 - leasing. i will do proper research on this, but any insights as to the ins/outs of leasing. Every time i read forums on leasing, people throw around a lot of acronyms and ratios that they deem god or bad...can anyone help this poor fool with a few good benchmarks to look out for?

3 - CARFAX - how accurate are the details there? can this report be taken as a good yard stick as to the quality of the car? Is the norm to still get a PPI?

Thanking you in advance!
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      02-14-2014, 07:23 PM   #2
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It's going to be difficult to secure a $60k+ loan with a credit score of 660, what you can do is probably put down a large down payment (60% - 70%) and finance the rest @ a higher interest rate. Or find someone to cosign the loan.
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      02-14-2014, 08:29 PM   #3
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Did you try financing/leasing with bmw financial? They're pretty liberal.
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      02-14-2014, 09:49 PM   #4
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do you have previous salary history than just this year? Show them you have a reliable income source and won't have any problems. Also putting a bigger down deposit will help.

BTW welcome to Texas
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      02-15-2014, 12:24 AM   #5
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Quote:
Originally Posted by GreatWhite View Post
It's going to be difficult to secure a $60k+ loan with a credit score of 660, what you can do is probably put down a large down payment (60% - 70%) and finance the rest @ a higher interest rate. Or find someone to cosign the loan.
Thats not entirely true. A 660 isn't bad and I don't know of a single prime lender who would ever return a response requiring 60-70% down.
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      02-15-2014, 12:28 AM   #6
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First, go through a BMW dealership and use BMWFS. If you go through a regular bank, you may not get approved or might get hit with a high interest rate.

As I stated before, a 660 is not bad and the finance manager could probably get it approved with as little as 10% down. Credit score doesn't tell the entire story - your credit history may not be long enough to get approved even though its factored into your score.

As far as leasing, don't bother. As strange as it sounds, leasing a car is more difficult than financing even though its the opposite in any other financial scenario
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      02-15-2014, 01:41 AM   #7
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Check with your Credit Union in your location, Chase, and BMWFS. I was in the same boat as you in couple years ago (credit history not long....but credit score was high 720+) Good luck.
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      02-15-2014, 01:56 AM   #8
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Quote:
Originally Posted by RR-NYC View Post
Thats not entirely true. A 660 isn't bad and I don't know of a single prime lender who would ever return a response requiring 60-70% down.
it's not required by the lender, but instead of getting a 60k+ loan with high interest rate, why not just put a big down payment and save some of that interest.
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      02-15-2014, 03:46 AM   #9
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Banks will want to see that other banks have loaned you similar amounts. Income is not always enough.

Don't waste your time applying on your own.

The easiest way to a satisfactory auto credit history (though certainly not the cheapest) is to simply finance or lease a brand new mass production $30-50k car through the dealer/manufacturer with little to nothing down. Pay on it for a year and you'll be approved for practically anything this side of $100k on the next go-round.
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      02-15-2014, 07:51 AM   #10
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Quote:
Originally Posted by RR-NYC View Post
Thats not entirely true. A 660 isn't bad and I don't know of a single prime lender who would ever return a response requiring 60-70% down.
660 is pretty bad.....
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      02-15-2014, 10:36 AM   #11
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Quote:
Originally Posted by Giorgia
Quote:
Originally Posted by RR-NYC View Post
Thats not entirely true. A 660 isn't bad and I don't know of a single prime lender who would ever return a response requiring 60-70% down.
660 is pretty bad.....
The FICO range is 300-850. If you were to graph it out, 660 is in the 75th percentile.

Depending on what type of credit you are applying for and how much, getting approved shouldn't be as difficult as you think

A 660 will not get you a prime interest loan but it will get you a secured auto loan through a lender like BMWFS. How much is the question.

Last edited by RR-NYC; 02-15-2014 at 11:09 AM.
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      02-15-2014, 12:28 PM   #12
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Quote:
Originally Posted by RR-NYC View Post
The FICO range is 300-850. If you were to graph it out, 660 is in the 75th percentile.

Depending on what type of credit you are applying for and how much, getting approved shouldn't be as difficult as you think

A 660 will not get you a prime interest loan but it will get you a secured auto loan through a lender like BMWFS. How much is the question.
Realistically anyone below 520 is automatically ineligble through BMWFS. So the functional range is 520-900. So 660 is on the lower end.

The dollar amount BMW will loan you will base primarily on your income. Secondly based on your previous borrowing experience. If you don't have a previous loan similar to what you're trying to borrow it's not going to happen without enough money down to make it somewhat similar to what you've borrowed on installment before.

The best thing is to find the car you want to buy, and know you're going to need 20-30 percent down for certain. But also be prepared to put up to half down. If you were to lease a new one 25% down plus taxes and fees is the max, and that should work for most vehicles short of the $100K+ vehicles.

And of course this all depends on the abilities of the finance departments. Good ones can get it done, bad ones won't be able to do anything.
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      02-15-2014, 02:40 PM   #13
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A bit of advice that I can give you is to bank with a credit union. They're willing to work with you a lot more than a big bank (Wells, Citi, Chase, etc).
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      02-15-2014, 03:47 PM   #14
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My sister has a job making 120k a year. She's one year out of school. 755 credit rating credit rating which beat mine by a couple of points even though I have had established credit for over 15 years. She was denied a loan for a $40k Acura so I had to cosign for her.

Your mortgage and lack of credit history is what's holding you back. 60k is only four or five months of work. Just save up and cut bmw a check outright. Forget financing.
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      02-15-2014, 05:27 PM   #15
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I'm a United States Prince, I am inheriting $58Mil US Dollars, if you send me the $25,000 for taxes to un-freeze the money I will purchase you a new M3/M4. Do we have a deal?
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      02-15-2014, 07:47 PM   #16
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Quote:
Originally Posted by TrakBch View Post
Realistically anyone below 520 is automatically ineligble through BMWFS. So the functional range is 520-900. So 660 is on the lower end.

The dollar amount BMW will loan you will base primarily on your income. Secondly based on your previous borrowing experience. If you don't have a previous loan similar to what you're trying to borrow it's not going to happen without enough money down to make it somewhat similar to what you've borrowed on installment before.

The best thing is to find the car you want to buy, and know you're going to need 20-30 percent down for certain. But also be prepared to put up to half down. If you were to lease a new one 25% down plus taxes and fees is the max, and that should work for most vehicles short of the $100K+ vehicles.

And of course this all depends on the abilities of the finance departments. Good ones can get it done, bad ones won't be able to do anything.
I'm quite certain FICO doesn't score above 850 so we might be talking about two different credit scores. I financed my BMW through BMWFS and the financial manager used my FICO.

I mostly agree with your post but I would suggest the OP go to the dealer and let the finance manager try to work out a deal and see what he needs to get it approved.

As far as leasing in concerned, putting a penny down is a bad idea let alone 25%.
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      02-15-2014, 10:54 PM   #17
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You may need to further your knowledge on FICO scores.

I can tell you I've seen plenty of scores over 875. Highest I've ever seen was 892.

I would agree with you on the cash down on the lease. But people with credit difficulties may not have the choice if leasing is the option they have to have. It doesn't happen often, but I've observed this.
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      02-15-2014, 11:10 PM   #18
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If you make close to 180k a year then there should be no problem. Go to BMW and pay cash for the car of your dreams.
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      02-16-2014, 01:27 AM   #19
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Quote:
Originally Posted by TrakBch View Post
You may need to further your knowledge on FICO scores.

I can tell you I've seen plenty of scores over 875. Highest I've ever seen was 892.

I would agree with you on the cash down on the lease. But people with credit difficulties may not have the choice if leasing is the option they have to have. It doesn't happen often, but I've observed this.
I don't need to further my knowledge about FICO scores. Like I said, we are talking about two different credit scoring systems. The official FICO score range is 300-850.

Perhaps you should further your knowledge about the difference between FICO, Beacon (both are 300-850) and Empirica - which scores from 150-934. In any event, your score range was incorrect no matter which you pick from.
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      02-16-2014, 02:42 AM   #20
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Quote:
Originally Posted by RR-NYC
Quote:
Originally Posted by TrakBch View Post
You may need to further your knowledge on FICO scores.

I can tell you I've seen plenty of scores over 875. Highest I've ever seen was 892.

I would agree with you on the cash down on the lease. But people with credit difficulties may not have the choice if leasing is the option they have to have. It doesn't happen often, but I've observed this.
I don't need to further my knowledge about FICO scores. Like I said, we are talking about two different credit scoring systems. The official FICO score range is 300-850.

Perhaps you should further your knowledge about the difference between FICO, Beacon (both are 300-850) and Empirica - which scores from 150-934. In any event, your score range was incorrect no matter which you pick from.
Ok buddy. :/

So I guess the 400 plus credit reports I've reviewed in the past two years for BMW FS were all figments of my imagination. Gotta get these eyes checked...
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      02-16-2014, 02:58 AM   #21
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Quote:
Originally Posted by TrakBch View Post
Ok buddy. :/

So I guess the 400 plus credit reports I've reviewed in the past two years for BMW FS were all figments of my imagination. Gotta get these eyes checked...
You are wrong, FICO scores range from 300-850.

You can confirm here: http://www.myfico.com/crediteducation/articles/
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      02-16-2014, 09:13 AM   #22
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Quote:
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Ok buddy. :/

So I guess the 400 plus credit reports I've reviewed in the past two years for BMW FS were all figments of my imagination. Gotta get these eyes checked...
You need more than your eyes checked, buddy. You realize I am arguing a FACT that can be supported within a 2 sec google search, right? I don't give a rats ass if you said you are the President of BMWFS - You are 100% wrong.

Post one link that supports your contention that the FICO scale goes above 850 and I at least won't think you're a complete idiot but you will still be wrong. Then, go to Fair Isaac Corp website and click the link to MyFICO and see for yourself.
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