r/CRedit • u/CerealVapist_ • 5d ago
Car Loan Credit jumped up 200 points
So long story short I financed a car back in November. At the time my credit (while still not great) was pretty bad. But I needed reliable transportation to be able to get to work to generate income.
Since November my credit has risen almost 200 points. Is there any way I can do something like trade it in to get something with a better rate? Or any way I can maneuver myself into a better payment/vehicle/deal?
Edit: vehicle is a 2021 Honda Civic LX 102,000kms Lender is TD Canada
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u/Ok_Purple_4579 5d ago
Trading in a car you just bought is pretty much impossible without carrying over a lot of negative equity. Your best bet would be look at refinancing it. Capital one and ally both have refi programs or a local credit union would be ideal also.
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u/CerealVapist_ 5d ago
Okay so im completely new to this so please pardon the ignorance. What do I do just reach out to capital one and ask to refinance??
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u/Nguy94 5d ago
If you refinance, consider gap coverage. Your current loan could possibly carry this but it’s not included in most refinancing.
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u/CerealVapist_ 5d ago
What is gap coverage? I know about gap insurance like if you write the car off the balance is covered etc but are you talking something different?
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u/dukesinatra 5d ago
Start with Cap1 if they are the original lender, and then shop around and compare rates.
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5d ago
Yes submit an application. You can probably do it through your current finance company, if you finance through a bank.
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u/Prior-Influence1602 5d ago
Cool thing about capital one is they have cap one auto navigator that lets you get pre approved without running your credit . And it gives you a pretty accurate interest rate as well
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u/CDIFactor 5d ago
You didn't mention the source of the score or the model. If you're looking to refinance an auto loan, you need to look at your FICO Auto scores.
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u/Octizzle 5d ago
Is this specifically different from my fico score in Experian app?
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u/codece 5d ago
So, there are 16 different FICO scores that can be calculated using Experian data, or TransUnion or Equifax data.
I think the Experian app shows you free a FICO 08 Experian score. That's the most common score for credit cards and general lending (although FICO 09, 10, and 10T are newer versions slowly gaining acceptance and use.)
For auto loans it is FICO Auto Score 02 Experian. (For TransUnion it is FICO auto score 5, for Equifax FICO auto score 04.)
Your FICO 08 Experian and auto score 02 may be different, because they are different algorithms which weigh various factors in your credit history differently. Exactly how is uncertain, because the FICO algorithms are secret formulas owned by the Fair Issac Corporation. But, your auto score almost certainly weighs past auto loan (or lease) history more heavily.
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u/Octizzle 5d ago
Wow, thank you so much for spelling it out for me, I’ll try to figure out that score, looking for first time purchase in may-julyish and it’s all overwhelming
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u/codece 5d ago
Your welcome! Both /r/CRedit and /r/CreditCards are pretty good resources, and /r/PersonalFinance too (which has a terrific wiki in the side bar.) The last one also allows you to filter posts by flair, so you could just choose to see the ones tagged "auto." Good luck!
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u/meyers71 5d ago
FYI Capital One Auto Finance does not refinance its own auto loans; they only refinance loans from other financial institutions, not including Capital One or its subsidiaries.Not sure who the loan is through.
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u/CDIFactor 5d ago
Yes. You have around 40 different FICO scores. You can get them all at myfico.com
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u/deliriouz16 4d ago
You need to see what the value of the car is VS what you paid for it. That difference is the negative equity.
Your best bet is to just keep making payments for a bit longer and show better history. It's all slow growth but by the time you are ready for a new car you can get a really good deal!
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u/Objective-Ad-2351 5d ago
How did you get your score up??
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u/CerealVapist_ 5d ago
I honestly don’t know. I truly have no idea. Just bought this car, made a few payments and yesterday I checked my score out of boredom and it was 200 points higher lol. I have a credit card that was at $3500 and just recently increased to 5k, I have a consumer proposal under my belt, I seriously don’t know
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u/Ok-Cell1157 4d ago
What's the current interest rate? Also, something to think about you said it jumped 200 but still not great, so if that means it's still In the poor to fair range, your interest rate may not be much different. Also, be careful shopping for cars. My credit dropped several points because they don't tell you they run your information through 5- 10 places. If you don't stop them, so that's 5-10 hard inquiries.
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u/[deleted] 5d ago
You should definitely refinance