How long do you have to do something, to be considered an expert? Or at least more knowledgeable than the average woman (or man)! I’ve mentioned him before, and I will mention him again: Greg Kurz is an expert in the McCarthy financing department. So I asked him about financing rates — how are they determined?
People are under the impression that their financing rate is determined solely by a number … your credit score. But this is oh so wrong! So what else decides your financing rate?
“Rates are determined by credit, carry (what you trade in), length of term (for your loan), previous car loan experience, income, debt to income and loan to value,” said Kurz. {Not sure what all of these terms mean? Check out Bloomberg’s Financial Glossary.}
“Banks want to know that you’re willing to participate with some money of your own,” said Kurz. And that means financing a vehicle is going to take longer than 15 minutes or a quick signature.
Is there any part of financing your car that confuses you? What questions do you have about rates or credit scores? Send me your questions and I’ll get them in front of our expert!
3 Comments
[…] Financing rates depend on more than your credit score « Lauren … […]
I have a question about credit scores. Just say that a person has had a hard time in the past and had some hits against their credit. What can that person do to improve the score? Will paying off collections help? What impact does medical have vs. say an unpaid credit card??
Thank you for your comments and questions. I shared your concerns with Kurz …
And his response was as states — “Paying off collections definitely shows character…And medical collections probably aren’t frowned upon as much as late credit card payments. As far as what affect it would have on your credit score is tough to even guess. The algorithms used to determine credit scores are a well kept secret and frankly very hard to predict.”
Does this answer any of your concerns? What other questions do you have?