519 Credit Score is
Limiting Auto Loan Approval

Can We Apply Direct to
Bad Credit Auto Lenders?


A car buying question from Ezio in New Jersey...
519 credit score is making it hard to buy a Corvette can we apply direct?


First, This is a great site. To get straight to the point, a Corvette dealer in Atlanta ran my wife's credit and came up with a 519 credit score. They said one more point [520 credit score] and they may have been able to help.

My main car buying question is if we want to buy a specific vehicle, the 7 bad credit auto lenders you list can not really help us right? Basically, you have to buy a vehicle from what they have? Is this correct?


Answer:

Hi Ezio,

Thanks for the compliment. The one point difference means that the lenders they are using automatically turn down all applications with scores below, in this case, 520. I know it seems ridiculous to turn a deal down over one point, but that's the way a lot of lenders do it in today's economy. This is not the case with all bad credit auto lenders and you can still get approved.

That being said, and taking into consideration that you are shopping for Corvette's, it would be well worth the time to do some credit repair to get her credit score up in order to open the door to more lenders. If not, then the finance charges (high interest rates) are going to be a killer.

If your wife has not personally reviewed her credit to see what is causing her to have a 519 credit score, then I'd highly recommend taking a look to see what's there. Get your Credit Report with enrollment at CreditReport.com!

With regards to bad credit auto lenders and vehicle selection...You can pick out whatever vehicle you'd like to buy (from the dealers inventory), but the whole deal has to be in line with the banks approval.

For instance, payment to income ratios must be below 15-20%, debt to income below 45% and the structure of the loan must be inline. Typically with bad credit auto loans down payment plays a big role in what vehicle you are able to buy.

If you have a very small or no down payment, then the dealer will essentially have to pick what vehicle you'll buy, because they'll have to choose a vehicle that fits all the bad credit auto lenders requirements from above. Loan structure tends to be the biggest hang up for car dealers when there is little to no down payment.

If you are asking if you can apply direct to the lenders on the list of 7, then the answer is no. The only lender that I know of that will lend direct to "subprime" credit customers is Capital One, but there are many restrictions and they don't give approvals as easily direct to the consumer as they do indirectly through the dealerships.

I personally do not consider Capital One to be a subprime auto lender, but more of a non-prime lender. This is the area between subprime and prime.


Ezio:

Thanks so much for the quick response......problem now is to figure out how to get her score up one point, lol.

Then again, I'm sure it went down with that inquiry. Maybe we'll give Capitol One a shot like you mentioned.
Thanks again,
Ezio

Answer:

To get her score up one point from a 519 credit score should be fairly simple and may require her to pay a small collection off and/or simply pay down a credit card. If you'll be paying some small collections, then take a look at How to Get a Collection Removed for some tips that should help.

If one or more credit cards is over the limit and/or the percentage of current balance to the cards limit is a little high...Take a look at my FICO score page as that may give you some more info as to how to get her score up quickly: fico score.

With a little bit of work and some time she'll be able to boost her 519 credit score to over 600 and beyond.

Hope this helps,
Justin


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