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how exactly do i finance a car? (hexbear.net)

submitted 3 months ago by [email protected] to c/[email protected]

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what's good comrades. tl;dr i didn't learn to drive until i was 27. i'm 31 now. in those 4 years, i've had two cars i bought cheap outright with cash, so i have never financed a more expensive car. these were 800 bucks each.

i only got a credit card at the beginning of 2024, i was terrified of debt my whole life so i never even wanted to get one. but i figure, i need credit to exist in amerikkka so the time has come. my score is 650 on one site and 697 on another. so let's assume it's like 670 actually.

i've applied for two auto loans but was turned down due to 'limited credit' but i see teenagers who work at wendy's driving nicer/newer cars they were able to finance, and i'm not even trying to get anything like that. i'm only looking to get a loan of like 4-6k, to buy cheap reliable used car from like 2005-2013. i see lots of options. i'm trying to avoid the dealer financing tho due to the dude telling me they typically charge like 25% interest through dealership financing.

how exactly does this work? is my only choice to get ripped off with dealer financing? i can't join a credit union, i've tried- limited credit. i don't get at all how credit works. i don't even want this shit. but currently i drive a 1995 toyota avalon that's falling apart and it's not safe to drive so i gotta figure something out

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[–] [email protected] 1 points 3 months ago (1 children)

It also seemed to help that my parents added me as an authorized user on one of their high limit cards when I was like a teen - I'm not sure how that can affect my credit but on credit reports it seemed to include their massive 30K credit limit into the calculation which appeared to help a ton, and I rarely or never used that card.

Honestly, that helped you way more than your box and chips method.

[–] [email protected] 1 points 3 months ago (1 children)

Well, they help with different things. Having my name as authorized on that card added a large credit line but didn't contribute to a credit payment history (I still had a "thin file" for quite a while and still had to co-sign my first apartment) nor does it help with a low credit utilization. In fact it hurt that aspect some because my parents would occasionally have a large balance and I would see my credit dip temporarily.

Regardless it's important to work on all the contributing factors of the credit score and available credit is just one of them.

[–] [email protected] 1 points 3 months ago (1 children)

More credit = lower overall utilization. Using $50 out of $100 total credit is 50% utilization which is very bad. Using $50 out of $1000 is 5%. There are other factors, but not all of them are important. For example, on time payments is probably the most important.

[–] [email protected] 1 points 3 months ago* (last edited 3 months ago)

I mean yeah that's true - I'm not disputing the importance of having high available credit, but if it was such a shortcut as suggested then it wouldn't have taken me years on top of that credit line to not have a thin file and a decade of buying monthly chips on multiple cards to get the score I have now. So I don't think it's exactly the cheat code that anarchoilluminati suggests it is.

What I'm getting at is that this credit line definitely helped a ton, but it didn't get me there on its own. It gave me a perfect score in credit availability but it took years for the rest of my credit score factors to fill in from my own small purchases on my own cards.

on time payments is probably the most important.

This also supports what I'm saying - that getting added as an authorized user on a high limit card helped in the available credit and utilization metrics, but that you still need to do other things to round out the score, which I don't think can just be brushed away by claiming that getting added to an existing card did most of the work.

Edit: also the problem with getting added to someone else's card for utilization is that their utilization shows up as yours too - so if my parents carry a balance of 15k on their 30k card then my utilization would have been better off if I only had $100 of credit and only used $5. While my available credit went down when that card closed my utilization actually improved because I don't carry balances so in my case being in their card only helped my total credit. Luckily by the time they closed that card my own credit line about matched what that card had so I didn't take a hit on available credit.