0% Financing

[HEMIJAKE]

This topic is very helpful. I have not given my credit score much thought. I pay my bill down to zero every month. I found my score was 769. I was wondering why I was not in the 800s. as it turns out, even though I pay in full at the end of the month, at any point in time during the month I was using a high % of debt. I now am paying off my credit card every few days. Next week I expect to be in the 800s.

The better debt to available credit you have, the better you'll be. I use one card daily for all of our expenses (to earn cash back), but I have several credit accounts, many department stores that we use but don't carry balances. We only use them usually for promotional 0% purchases (home depot, discount tire, harbor freight, etc.). Try to get that debt ratio under 10% and it your score will shoot up.

 

[mikeru82]

That’s part of the answer to “why would a manufacturer offer 0%? There must be a catch!” To keep you from buying from a competitor instead.

Other answers: to encourage you to but now instead of later, or buy something instead of nothing. Or, to buy a more expensive vehicle than you would have without 0% financing. It’s just another incentive.

If you can get 0% on a vehicle you were planning on buying anyway and at the time you were planning on buying, take it (assuming you don’t miss out on other incentives), even if you could pay cash. If 0% entices you to buy more or sooner, or if you can’t trust yourself to keep money in the bank or invested, that advice is null and void.

But otherwise, take the 0%, hold on to your money to invest, build a safety net, or pay down other interest bearing loans. Heck, it times of 8.5% inflation, any interest rate under that is negative real interest, and so it may be worth taking the loan. IF you can trust yourself to be prudent with the money you otherwise would have paid in cash towards a truck you would have bought regardless.

Keep in mind my financial advice is worth every penny you paid for it.

Sound financial advice. I feel I got my moneys worth.

 

[Rich6896]

The better debt to available credit you have, the better you'll be. I use one card daily for all of our expenses (to earn cash back), but I have several credit accounts, many department stores that we use but don't carry balances. We only use them usually for promotional 0% purchases (home depot, discount tire, harbor freight, etc.). Try to get that debt ratio under 10% and it your score will shoot up.

It is counterintuitive, isn't it? You would think a guy who has the ability to go to Vegas and max out $60k in cards would be a worse risk than me who uses up to $12k on a $30k card.

 

[HEMIJAKE]

It is counterintuitive, isn't it? You would think a guy who has the ability to go to Vegas and max out $60k in cards would be a worse risk than me who uses up to $12k on a $30k card.

I hear ya there. The difference is that guy has shown that he won't go and do that I guess. My score is just over 800 and I only use about 1% of my available credit (according to credit karma). My score would probably be higher but I have a lot of hard inquiries from changing / buying vehicles (truck, camper, utv alone in the past year ).

 

[GKIII]

The better debt to available credit you have, the better you'll be. I use one card daily for all of our expenses (to earn cash back), but I have several credit accounts, many department stores that we use but don't carry balances. We only use them usually for promotional 0% purchases (home depot, discount tire, harbor freight, etc.). Try to get that debt ratio under 10% and it your score will shoot up.

Exactly, I have like $100k in available credit. I pay off my 'regular' cards every month.

 

[HEMIJAKE]

Exactly, I have like $100k in available credit. I pay off my 'regular' cards every month.

Bingo. Had this argument with an older co worker of mine. She said she would just cancel accounts when she didn't use them (to avoid fraud I assume). I told her that is the worst thing to do. The more accounts, the older the accounts are, and the more open credit the better off you are. The guiness records guy with perfect credit has like 1,500 accounts and over a million in credit I think.

 

[cevans6318]

I’m still confused to hell as to Chrysler’s either high interest rate or denial of credit with an 855 credit score. There 4 reasons make no sense. Still convinced something the dealer did was the reason for this.

 

[HEMIJAKE]

I’m still confused to hell as to Chrysler’s either high interest rate or denial of credit with an 855 credit score. There 4 reasons make no sense.

With an 855 you should be able to buy anything you damn please ha. I'd call and ask somebody.

 

[jl13]

I wonder if in part that's due to Ram trying to hang on to second place in sales over Chevy. In Q1, Ram only moved 6k more trucks. Of course if you combine Chevy and GMC since their the same truck, Ram is really in 3rd.

that's for sure

 

[jl13]

This topic is very helpful. I have not given my credit score much thought. I pay my bill down to zero every month. I found my score was 769. I was wondering why I was not in the 800s. as it turns out, even though I pay in full at the end of the month, at any point in time during the month I was using a high % of debt. I now am paying off my credit card every few days. Next week I expect to be in the 800s.

recently found out the same thing, my credit is always around 820 a few months back it took a 40 point drop and was due to a low limit max out card. It went right up the next month/quarter after I pay it off.

 

[Aseras]

I’m still confused to hell as to Chrysler’s either high interest rate or denial of credit with an 855 credit score. There 4 reasons make no sense. Still convinced something the dealer did was the reason for this.

That's a CYA letter. They "deny" everyone and send a generic BS reasons letter so they don't fall afoul of the TILA.

 

[cevans6318]

That's a CYA letter. They "deny" everyone and send a generic BS reasons letter so they don't fall afoul of the TILA.

Doesn't seem like they deny everyone. People with scores way less then mine qualify for 0% APR.

 

[Yankee Echo]

I’m still confused to hell as to Chrysler’s either high interest rate or denial of credit with an 855 credit score. There 4 reasons make no sense. Still convinced something the dealer did was the reason for this.

With an 855 you should be able to buy anything you damn please ha. I'd call and ask somebody.

Quick anecdote: Many years ago I had a friend who worked at a discount furniture store that offered "free" financing. They would intentionally mistype someone's SS# or other information so the buyer could only qualify for a high interest rate. 9 times out of 10 the buyer would just accept it and be stuck with the 18% interest.


Loan approval is based on more than credit score. To satisfy my curiosity, I looked up the descriptions of the factors from your letter. Not passing any judgment, just wanted to share what I learned.

“Too many consumer finance company accounts” - Credit bureaus may penalize borrowers for taking out loans through finance companies. Credit bureaus know that consumers who use finance companies tend to have higher default rates. They also know that the higher interest charged by finance companies can increase the default risk of their clients. The higher the interest rate, the more likely the debtor is in a negative equity situation or decides to stop paying.

"Lack of recent auto loan information" - Couldn't find anything specific but seems self explanatory. No auto loan history in the lookback period.

"Too few accounts currently paid as agreed" - Even if always paid on time, this risk factor statement can come up for a short credit history or a "thin" credit history.

"Proportion of loan balances to loan amounts is too high" - The balances of non-mortgage installment loans (such as auto or student loan) are high compared to original loan amounts. That could mean there are a number of recent loans and indicates risk to be borderline overextended on debt.

 

[MO Rebel]

Doesn't seem like they deny everyone. People with scores way less then mine qualify for 0% APR.

My credit score is the same as yours, and I was approved. Doesn’t make any sense to me unless that letter is some shenanigans being played by your dealer.

 

[Jokerpro]

That's a CYA letter. They "deny" everyone and send a generic BS reasons letter so they don't fall afoul of the TILA.

Yeah, we were approved but still receive one of these letters a couple of weeks later. We thought it was weird but now makes sense.

 

[cevans6318]

Loan approval is based on more than credit score. To satisfy my curiosity, I looked up the descriptions of the factors from your letter. Not passing any judgment, just wanted to share what I learned.

“Too many consumer finance company accounts” - Credit bureaus may penalize borrowers for taking out loans through finance companies. Credit bureaus know that consumers who use finance companies tend to have higher default rates. They also know that the higher interest charged by finance companies can increase the default risk of their clients. The higher the interest rate, the more likely the debtor is in a negative equity situation or decides to stop paying.

"Lack of recent auto loan information" - Couldn't find anything specific but seems self explanatory. No auto loan history in the lookback period.

"Too few accounts currently paid as agreed" - Even if always paid on time, this risk factor statement can come up for a short credit history or a "thin" credit history.

"Proportion of loan balances to loan amounts is too high" - The balances of non-mortgage installment loans (such as auto or student loan) are high compared to original loan amounts. That could mean there are a number of recent loans and indicates risk to be borderline overextended on debt.

I have 4 credit cards and a mortgage only. all 4 credit cards have a 0 balance at any given time. Only use them for the rewards and pay the balance off each day.

last time I had an auto loan was 2014 that was paid off in 2019.

I have paid all of my accounts on time for the past 20 yrs. No way I am going to have an 855 credit score with missed payments.

only balance that is high is my mortgage and that is $149K.

Most of those are BS answers as to the denial or why they offered more then 2.9%. For me to get easily approved less then a month later on a refinance for 1.9% just tells me either chrysler sucks or the dealer had something to do with it.

 

[cevans6318]

My credit score is the same as yours, and I was approved. Doesn’t make any sense to me unless that letter is some shenanigans being played by your dealer.

I am more than convinced the dealer is behind the reason why. They were looking for any reason to get some type of kickback if they could get me into an loan with a higher interest rate. For all I know, chrysler approved the 0 apr but they just told me I didn't qualify. I will truly never know at this point.

 

[Idahoktm]

I am more than convinced the dealer is behind the reason why. They were looking for any reason to get some type of kickback if they could get me into an loan with a higher interest rate. For all I know, chrysler approved the 0 apr but they just told me I didn't qualify. I will truly never know at this point.

I know it doesn't help you, but for someone else reading this thread, I wonder if you can demand that they show you the denial.

 

[Southside]

I got 0% for 72 months on the big horn I bought in early March. No hidden fees. And no I do not have an 800 credit score, actually closer to 700. Not sure why some are approved and some aren’t.

I'm similar to you, 770 and got Chrysler 0% x 72 on my Big Horn at MD. I call on the finance departments that say people don't qualify, especially with a 800+ score.

 

[Yankee Echo]

Most of those are BS answers as to the denial or why they offered more then 2.9%. For me to get easily approved less then a month later on a refinance for 1.9% just tells me either chrysler sucks or the dealer had something to do with it.

Out of curiosity, did you fill out the credit app online and was it through Mopar Chrysler Financial? Or did you provide info to the dealer and they entered it?