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1) Never trust anyone at a car dealership if it isn't in writing.
Lesson learned, that's for sure.
2) It is against FTC law and against FL CPB law for a lender to require GAP Insurance to finance with them or to tie it to a lower rate. Report that bank immediately, it is a $50,000 fine per occurrence.
I figured as such. Will certainly steer clear.
3) That 675 credit score is killing you. You will struggle to get a lower rate than 7% from anywhere that doesn't do manual underwriting with that score. I would imagine that your DTI and LTV ratio's are probably also out of wack, increasing the problem.
DTI is under 25% in entirety including all debts. LTV ratio I was told by the lender is at 95%. These both seemed like good numbers all things considered. The 675 I agree is my problem. Unfortunately not much I can do about it beyond wait for my length of credit history to increase.
4) Most mainline lending institutions will increase the rate with the age of the car, in addition to the term of the loan and the LTV. Many lenders won't even loan money on a car that is more than 8 years old, so that is also probably causing you a problem.
5) Doing a shorter term loan (less than 48mos), getting the LTV down below 80% with some cash, and using a manual underwriter will help you - but I would be surprised to see a rate lower than 6% based on what you have indicated in your post.
Honestly I would be happy with 6%, and do plan on paying it down quicker than the term. I will call my local CU to see what they can offer.
Much appreciated!
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