Why is my Credit Karma score different than the score car dealers see?

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You may have noticed that every lender or car dealership that runs your credit seems to have a different credit score for you.  We talk to clients all the time that do not understand how different companies can pull The reason this happens is that inside each of the three main credit bureau brands (Equifax, Experian, and TransUnion) there are several different scoring models.

Perhaps you have heard these terms before: FICO, Beacon, Auto Enhanced…and there are more. There are even different score versions.  Your Equifax Beacon Version 5.0 Auto Enhanced score will be different than your Beacon 8.0 Auto Enhanced score. The non-Auto Enhanced version will also be different.

Why are there different scoring models? 

Each scoring version counts different types of good and bad credit differently. Then lenders use that data to weigh how each applicant will be scored for their loan.  For example, an Auto Enhanced score is supposed to better predict how well a consumer will pay an Auto Loan.  It makes sense if previous auto loan performance is given greater weight when scoring the odds of future auto loan repayment.  That is just one example.  There are more than I can possibly specify here.

Lenders usually pick a certain scoring model and stick with it for all of their applicants. That way every customer is compared on an “apples to apples” basis, because the scores are all weighed the same way.

Which credit scoring model does Credit Karma use?

Credit Karma currently uses something they call VantageScore 3.0.

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This is the VantageScore 3.0 information provided on CreditKarma.com

What auto lenders use VantageScore 3.0?

None that I have found. VantageScore 3.0 seems to be designed strictly for consumers to monitor changes in their credit.

Can a lender use your VantageScore 3.0 Credit score instead of the credit score they pulled?

No. Lenders want to use the same scoring model for each applicant so that they can make decisions consistently, so you cannot use your 801 Vantage score instead of your 680 Beacon 8.0 score.   Using a different credit score to get a loan would be like using Venezuelan currency to pay your mortgage instead of US dollars.  It would be great for you, but not for the lender.

How does VantageScore 3.0 compare to credit scores that lenders use?

In my experience, the Credit Karma scores that users see are usually much higher than their “real” credit scores that lenders use.  There is nothing wrong with that, because the VantageScore 3.0 model just gives you a measurable number to keep track of.  If your VantageScore credit score goes down, your other credit score versions probably went down too. If your Credit Karma score goes up, the other scores probably went up.

The most important thing for you to remember when looking at your Credit Karma scores is that the scores you see ARE NOT your credit scores that lenders or auto dealers typically see.

If you want to get an idea of what your score is, without giving out your Social Security Number, fill out this form at Washington Auto Credit. Also, you may be given an idea as to how large of an auto loan you could be pre-approved for.

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How to Buy a Car near Seattle with No Money Down

Are you in need of a car near Seattle but don’t have money to put down for financing? It’s a common myth that you can’t get auto financing with no money down, but at Washington Auto Credit we are here to set the record straight. We have car buyers come in all the time that are in restrictive financially situations and aren’t comfortable with putting a large sum of money down on their car purchase, and we have a strong record of helping these people find the right car and secure financing. Here are some things to consider if you are interested in buying a car with no money down.

Putting no money down on your car purchase might actually make more sense for you! If you decide to keep the cash you have in your pocket and not put it down on a car payment, it will affect your monthly car payment. However, a lot of the time it doesn’t affect it that much! For many car purchases, putting down a few hundred dollars on a down payment might only affect the monthly payment by a small amount. If your monthly payment only changes by a few bucks, sometimes it makes more sense for the buyer to keep their money in their savings account and have it accessible in case of a rainy day.

Since we work with a wide range of the most capable lenders around, we are able to get many people in Seattle area auto financing without money down. However, sometimes the buyer might need to meet some conditions. To help you chances of getting a no-money down loan, it is beneficial to have a good credit score. The higher your credit score, the more likely you will get a loan without money down and you will most likely get a better finance rate which will result in a lower monthly payment. Many of us don’t have a high credit score and that’s alright! We can help you too! If your credit score is less than ideal, it’s a good idea to see if you can find a co-signer. A co-signer is a second person that signs on the loan so they are partially responsible if payments aren’t made. Getting a cosigner basically just reassures the lender that you are trustable to make your auto payments. If you have a trade-in vehicle with positive equity, this could also help you get a car payment with no money down. Many car buyers at Washington Auto Credit trade in their car since we give great trade in rates for used vehicles.

Since every buyer has a unique situation, it’s best to call us or meet in person to see if you qualify for a no money down auto loan. We are located in Olympia, Washington however we help auto buyers all over the state secure auto financing. To learn more about qualifying, please submit a contact form or call us today at 800-836-8884

Why Bad Credit Auto Lenders Like Newer Cars

If you have a poor credit score, you might be worried that you won’t be able to buy a newer car and instead will be stuck with an old junker vehicle. However, this is not the case for most buyers! Believe it or not, most bad credit auto lenders like newer cars. In fact, the newer car is sometimes easier to get a bad credit buyer to finance than an older one. Here are some of the reasons why checking out the newer vehicles is actually a good idea!

Newer cars can be easier to get financed

Pretend you are the bank and are loaning out a large sum of money to a potential car buyer. Would you rather have the buyer purchase a ten year old vehicle for $10,000 on a five year loan, or a three year old vehicle for $15,000 on a five year loan? If you said the three year old vehicle, that is the right choice. The lender likes loaning money on newer vehicles because they have a greater chance of staying on the road and avoiding major breakdowns. For example, if they do the loan on the ten year old car and the transmission goes out, they could be in trouble if the buyer decides it isn’t worth fixing and stops making their payment. For this reason, the newer car is the smarter choice for the lender.

Newer cars mean less risk for the lender

From the lender’s point of view, they want to make money on the auto loan and not to lose money. Obviously, the lender makes some money on most car loans or else they wouldn’t do it in the first place. When deciding to make a loan it all comes down to how much risk is involved, this is mainly determined by how trustworthy the buyer is to make their payments (gauged by their credit score) and by the value of the vehicle they are buying. If for some reason the bank makes a poor decision on who they make a loan to, they will have to take the vehicle back. The lender is in better shape takinU92671-2015-Volkswagen-Passatg back a newer car than an older one since it probably is worth more money and less likely to have had major mechanical problems.

Find a newer vehicle to purchase with bad credit

If you are asking yourself where a good place to purchase a newer car with bad credit is, you are in luck! At Washington Auto Credit we have an excellent reputation of getting people auto financing with minimal requirements. We also have an impressive selection of newer used vehicles to choose from. Come see us today in the Olympia Auto Mall!

Washington Car Buyers – Here is How to Calculate Interest for an Auto Loan

For those looking to purchase a new or used car, there are several factors to first consider before making such a large and involved purchase. First, the obvious ones, you want to choose a car that gets good gas mileage, one that doesn’t have a ton of miles on it if it is used and one that is still running well. Besides these and other personalization touches, you will also want to be able to have a general idea of the interest you will incur on an auto loan if you are using one to purchase your new set of wheels. Even better, you might even want to be able to calculate the interest on your auto loan yourself so that you know exactly what you are getting yourself into for the long haul, especially if your auto loan payments extend over a period of a few years.

Sure, it’s easy to type auto loan interest calculator into an internet search engine and be provided with a whole host of different online calculators that can within a few seconds or less given you a mostly accurate account of what type of interest you are looking at from your auto loan.

Or, you could learn to calculate your own interest from your auto loan, thus giving you the most in depth understanding of what costs are going to come along with buying a new or used car. Here’s how to not get overwhelmed when calculating your interest and be informed about what you are paying for.

First of all, you’re going to need to know a few things prior to starting your interest calculation process. These need to know items are the principal amount you will owe on the car loan, the term agreements of the loan itself and then the interest rate. These will vary person to person so make sure you are using your own personal information and not some average number from the Internet. For basic uses, understand that most auto loan providers used amortization schedules in order to calculate interest. Amortization is a complicated formula to use, so in this case, it would be wise to find such a calculator on the web in order to best figure out your interest rate. Use this calculator to first determine your allotted monthly payment amount.

Obviously, a car loan comes along with the standard amount of paperwork to complete and this is where you can find most of the above needed information. For instance, the interest rate will be explicitly stated on your car loan agreement. Now that you have gathered all the necessary materials, calculating interest is easy. Just simply use the amortization calculator you found online and input your personal information, this means the principal cost (which is also the amount you borrowed in full) and your interest rate from your loan provider. Then you simply choose the time period over which you want to attempt to payback the loan and viola, you have calculated your interest rate for your car loan in a few quick and easy steps.

At Washington Auto Credit we will breakdown your loan for you and show you where your monthly payments are going. If you have any questions about calculating your auto loan interest, give us a call today at 800-836-8884.

How to Rebuild Your Credit Before Buying a Car in Washington

When thinking about some of the major purchases we make in life (buying a house, paying for college), one that is truly close to your heart and a source of pride is buying a new car. Think about it… A vehicle is something that you use every day, and has become not only a luxury but a necessity.  But the road to buying a car is often not easy.  It takes money.

Cars can range from a few grand to over a few hundred thousands. And it all boils down to a few things. Whether or not we can afford it. Although there are those who can pay cash and drive away, most of us need to get a loan and that is where things get complicated. What happens if your credit history and scores are not that peachy? While your credit may be dismal and you have a history of spotty credit, a few late payments, and your FICO score is not robust, there are several steps you can take to help rebuild your poor credit so you can get into that perfect (or almost perfect) car.

  • Get Real: Start by Taking an honest Look at your credit score

Although you may be dreaming about driving in your brand new car, you first must be realistic and find out what your credit score is. A credit score is the number lenders look at in order to access your credit risk. You can check your credit with the three most well known customer credit report agencies: Experian, Equinox, and TransUnion. Bad credit usually means more difficulty in getting an approval for your loan and higher interest rates.

Another important number is your FICO (Fair, Isaac and Co) score. Before the FICO scores, lenders would have to use personal judgement but now it is a science of collecting credit history, activity and use. The higher the score, the lower the interest rate. FICO scores are mainly between 300-850.

After taking a good look at your scores (which can be done at Washington Auto Credit) , it is time to clean up your report and work out any disputes, possible mistakes.

2.  Look at Past Behavior and Credit History:

Remember the higher the risk you are, the less money you can borrow and the higher the interest rate.

Red Flags for lenders are repossessions, foreclosures, missing payments or sudden increase in credit applications which may indicate you need money.

3. Do not live in the past…Steps to Change your Poor Credit History

Although it may not happen over night, improving your credit can be possible with some steps.

  • Pay On time:  Always. Not doing so can hurt your credit score.
  • Keep your balance low and watch your credit utilization. One of the most important factors agencies such as Experion use is your credit card utilization. This is when the amount of debt you have is compared to your credit limit and preferably should be kept low, preferably under 30%. High utilization may indicate a big spender who may later have trouble paying off the debt accumulated. In other words, be cautious and don’t max out your card. You may have a 10,000 dollar limit, but that doesn’t mean to put $9,000 of debt on it.
  • Watch for multiple cards and multiple balances. If you have balances on many cards, you may want to consider paying off your balances and using one.

4. What to do if your Credit Score is really low.

    The fight is never over till the Sales Person or lender says “no”. Until then, take steps to obtain a loan and get that car.

  • Cash is king. If you never had a car loan or a spotty credit history, you may want to save and put a large down payment. This could make a difference and help your loan approval.
  • Honesty is the best policy: On your form, be as honest as possible. Do not exaggerate your salary for example. All information is verified so it does not pay to lie.
  • Consider buying Used. Although new cars have that new car smell and may have better warranties and services, remember a car depreciates as soon as it is driven off the lot. So an used car may be a good option to save money after it is cleared for any defeats or faults.

The final tip is to buy what you can afford in order to keep the price down. Yes, you may want that Ferrari, but your budget may be more Fiat. But remember to pay your payments on time, and clean up your credit and who knows…Maybe your second car will be your dream car.

At Washington Auto Credit we are masters at getting people financing on their next vehicle. If you have a low credit score, we may be able to help. Contact us today!

4 Great Used Vehicles for Buyers on a Tight Budget

Are you desperately in need of a new car, but have a small budget?  There’s absolutely no need to worry, as the option to purchase a used car in Olympia is always available, through which you will not only save money and stick to that budget of yours but you’ll also be able to select from a broad variety of automobiles that are all ready to be driven by you! This idea has been significantly promoted through the media and is encouraged to those who want to save big on cash.

Purchasing a used car model at a lower sale price does not in any way advocate the idea that the car maybe at fault, but its depreciation in price is the result of a simple concept. After the duration and use of one whole year a completely new car decreases in price approximately 27 percent from its original sale price and after the duration of only three years it has decreased 50 percent of its original price. This idea is both bitter for the full price payer but definitely sweet for you as this means that you are able to pay less for a car that isn’t incredibly ancient. However choosing the right second hand car is by no means a simple affair. As you probably want the best value for your money, an ideal used car should be reliable, reasonable, and most importantly –safe! In addition to this a car that has sustained damages due to accidents is to be avoided at all costs. To make this difficult decision a little less daunting, we’ve compiled a list of the top four used car models that you may want to consider!

  • Sedan Acura TL (2005): Through purchasing this car you can achieve the comfort of a luxury vehicle without spending large amounts of money! Incorporating modern design and innovative technology, this car will probably tick all of your boxes in terms of its numerous safety features, incredible convenient drive features, lush entertainment facilities and sleek design. The Sedan Acura TL 2005 model can offer a lot to its drivers so definitely keep this one in mind.
  • Subaru Impreza (2010):  This standard design provides its users with the of availability of a hatchback ideal for storage and common sedan body styles, as well as a rear seat that provides space for three adults that simply contribute to the Impreza’s  incredible versatility. Its design as an all wheel automobile definitely provides it an edge over other cars as this feature allows for a smooth and supple ride on the road. Research has indicated that the Subaru Impreza (2010) should provide no concerns for buyers!
  • SUVs Acura MDX (2005-06): This automobiles MDX’s silent interior and quick to respond handling allow for an enjoyable take on common family-friendly vehicles, show casing why this car hits the standard for three-row common crossover SUVs. If you’re looking for a car that is ideal and well suited for a family environment then you should probably keep this automobile in consideration. With its clever stylistic design and attractive features that car can provide much to its new owner!
  • Toyota Prius (2010-13): Results and experiments indicate that the Prius does not much require drivers to lose space or ride comfort to achieve a positive gas mileage, and now with the redesigned 2010 model a quieter, subtler engine and standard electronic stability control has been achieved. With its sleek and modern design finishes, you could have the most attractive wheels on the road if you decide to purchase this vehicle!

These are just a few examples of great used vehicles for buyer’s tight on cash. There are many other great used cars to choose from at Washington Auto Credit. Call us to learn more or visit us in person in the Olympia Auto Mall!

5 Tips for Buying and Financing a New Truck

Whether you have owned many trucks, or this is your first truck purchase, you will want to read these five tips to help your next truck buying experience go smoothly. When searching for your next truck it’s important that it not only meets your needs and wants, but also fits in your budget. Here are some tips on finding the perfect truck for you and keeping it affordable.

Make Sure it Has What You Need

When you step on the car lot, you are probably going to be tempted to test drive the fully loaded brand new truck with all the bells and whistles. There’s no question that having features like heated seats and sunroof are going to make your driving experience more enjoyable, but are these things that you can’t live without? You might decide that a sunroof is very important to you however leather seats aren’t. This is good information to give your salesperson so they can properly match you with a truck and you don’t have to pay for features that you aren’t going to use. There is a good chance that you are buying a truck because you are using it for towing, hauling, or off-roading. Make sure your truck meets all of these needs before making the plunge and purchasing. Whether you are buying new or used, you should be able to hop online and find out your trucks specs to make sure it matches all your needs.

Consider buying a 4×2

Many truck buyers go right to the 4×4 section when looking to buy a truck, but a large portion of these people never even use the 4×4 on their truck. If you aren’t going to use it, why pay the extra money for it? 4×2 trucks are almost always less expensive than their 4×4 counterpart and visually they are often very similar. Unless you plan on doing some serious off-roading, the 4×2 might be the better option for you and will save your wallet the extra strain that the 4×4 truck price tag creates.

Make Sure It Has Enough Power

If you are using your truck to tow a trailer than you want to make sure it has the power to handle it. This should come as a no brainer, but you’d be surprised how many people purchase before thoroughly reviewing their new trucks specs. If you are using the bed of your truck to haul a fifth wheel, you will also want to make sure that your truck has enough payload to handle it. Tell your sales rep what you plan on towing and they should be able to help you figure out if your new truck can handle it.

Consider Buying Used

There is no question that the new car smell is nice, but is it worth the price? If you buy a truck that is just a year or two old, there is a good chance it will still be under the manufacturer’s warranty (make sure to ask your salesperson about this) and it can be much less expensive than buying new. If you are worried about your used vehicle having mechanical problems, you can also see if your dealer offers extended coverage warranties to make sure you are prepared if the unexpected happens. By buying used, you will most likely save a lot of money compared to buying new and for this reason many buyers choose this route.

Check Your Financing Options

When you buy your new or used truck, make sure you get a good finance rate to keep your payments down. If you have credit problems: GET PRE-APPROVED FIRST. Don’t waste hours and hours looking for the perfect truck, only to be disappointed. To see what rates you can qualify for financing in the Olympia, Washington area, contact Washington Auto Credit today.

Tips To Get an Auto Loan With No Credit

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Being able to get a vehicle loan in Washington even when you have no credit is no longer impossible. Some people seem to think that having no credit will keep them from being able to do this, but there are ways around this problem and many auto loan services will give you a chance to acquire your vehicle even if you have no credit history at all. In this article, we are going to give you some important tips on how you can make this happen.

The first time buyer can find himself having an advantage as some dealerships and credit providers are willing to help them finance their first vehicle. You are usually going to need a 10 to 15% down payment and you need to have proof that you have a steady job with a steady paycheck. Sometimes you can even use your current vehicle as a trade-in towards your downpayment if you don’t owe money on it or if it’s worth more than you owe. Once you are able to meet the downpayment requirements there is a good chance the Washington Auto Credit can help you get financed.

If you have just graduated college, you might be able to take advantage of that situation too. There are some companies that are willing to give you a very sweet deal for your first vehicle and you might not even have to provide any down payments. Many auto manufactures offer college rebates for recent graduates that can help with their finance rate or total total vehicle amount.

Looking for a co-signer is always going to be an option and if you can get someone to co-sign with you, this is going to be a serious increase for your chances of getting a loan. New auto buyers usually turn to family or spouses if they need a co-signer. If you need a co-signer, you will have better luck completing your loan if they have a steady job or have good credit.

If you have little to no credit and are looking for an auto loan in Washington state, contact Washington Auto Credit today. We are the best you can find at getting people with no credit auto loans. Contact us today to learn more, or visit us in person in the Olympia Auto Mall.

Car Buying and Financing Tips for New College Graduates

By the time you graduate college, there is a good chance that you are ready for a new car. Many of us remember our college car as a vehicle with very few bells and whistles, but we were just happy if it got us from point A to point B. Now that you have a graduated and are starting a new career, it’s time to get something that you are proud to drive around. Here are some tips to buying a car when you get out of college.

Buy something fun, but practical

When you first step on the car lot, you are going to be tempted to buy that glistening brand new sports car, but in reality you probably shouldn’t. Get something that fits all your needs, gets decent gas mileage, and is reliable. If you are the outdoorsy type, consider a small SUV that can get you to your next hiking destination. If you need your car primarily for commuting to work, get a small sedan that gets good gas milage and can pack your friends around. Once you have settled on a vehicle you like, check into finding a pre-owned version. Buying used will save your money compared to new, and will keep your payments more manageable leaving you money for other things (like rent and groceries).

Check for Rebates

If a used car isn’t for you and you decide on a new vehicle, make sure to check for College Graduate Rebates. Many auto manufacturers offer rebates to new college graduates to help them get started in the working world. Finding out who offers rebates can be as easy as going to the automaker’s website and entering your zip code. Sometimes the rebates aren’t much, but every little bit helps.

Get a Cosigner if Possible

If you just graduated college, there is a good chance that you don’t have a lot of credit. This can make it more difficult to buy a vehicle. There are steps you can take to building your credit like getting a credit card, but you might not want to wait until this takes effect. Your best bet for buying your next car might be finding a cosigner. A cosigner is someone who also signs on the auto loan to help take responsibility in case payments are delinquent. This can usually be done by a parent or other close family member with good credit.

Get a good finance rate

Your finance rate helps determine how much you will pay each month on your vehicle. The lower the rate the better (for example, a 5.9% finance rate is better than a 6.9% rate.) It’s important to get a low finance rate in order to keep your payments low. If you are interested in applying for an auto loan in Western Washington area, contact Washington Auto Credit today. Our professionals can help you get the best rate possible on your next vehicle loan.

Should I reaffirm my auto loan after bankruptcy?

Hundreds of thousands of Americans file bankruptcy each year.

Many of the people that file for bankruptcy owe money on a car or truck already, and they have to decide whether or not they will reaffirm their auto loan.

If you don’t know, a reaffirmation agreement is between a debtor and the lender and it allows the debtor to exclude the loan from a Chapter 7 Bankruptcy.  Basically, it means that the person who filed is still responsible for the loan, and will have consequences if that loan is not paid (just like if the bankruptcy never happened).

For most people, reaffirming a loan after bankruptcy is a bad idea.

First, the majority of people with car loans owe too much money on their vehicle. When you owe more money on your vehicle than it is worth, it is called Negative Equity. Typically, people do not put enough money down when they buy cars and they extend the loan to get a low payment. Good or bad credit, you can still have negative equity if you do not put a lot of money down and you choose a long term loan. If you just filed bankruptcy, why would you want to take responsibility for a vehicle you owe too much money on?

Second, it is common for a reaffirmed loan to still show included in bankruptcy on your credit bureau. If there is a chance that you will not get a positive credit rating for an account, why keep it?

There are some situations where it can make sense to reaffirm an auto loan after bankruptcy.

Do you have a significant amount of equity? Do not give away that equity. Sell the car or trade in the vehicle so that you get that money back. But beware, not everyone who THINKS they have equity really does. Your vehicle is only worth what someone will pay for it. Talk to a reputable dealer in your area and ask them to do an appraisal to buy your vehicle. That way you can find out what it is really worth, should you want to sell it quickly.

Is there a co-signer on the loan that did not file bankruptcy? If you cannot give the vehicle back in the bankruptcy because you do not want to hurt the co-signer’s credit, you still may be able to avoid a reaffirmation agreement. The best thing you could do is surrender your interest in the vehicle in the bankruptcy, but keep the loan payments current so that the co-signer does not have a penalty on their credit. Eventually you will pay the loan down enough that you can trade the car in and get it out of the other person’s name. If the lender requires you to reaffirm the loan, then sometimes that might be the right decision, depending on your relationship with the co-signer.

Another reason to consider reaffirming a loan after bankruptcy would be if you do not qualify for financing after your bankruptcy.  If your income is too low to get approved for a car, or if you need a full ton truck for your job, but you do not qualify for a large enough loan to buy that type of vehicle it might make sense to reaffirm.

Outside of those unique situations, do yourself a favor and do not reaffirm your loans. If you want to keep a vehicle, redeem the loan. But do not reaffirm.