Allen K

iTrader: (4)

Depends on where you are, but not very competitive. My credit score was in the 820s when we applied and it was 3.99% in NJ. They're partnered up with Wells Fargo Dealer Services I believe. I ended up getting 1.99% from my credit union and went with them

-J-P-L-

I really hope the average score for a Lexus buyer isn't just 699! Shouldn't even be buying a Lexus in that case.

arentz07

Yeah I am guessing this includes used-car sales. If so, Tesla has an obvious "advantage" (if you will), since the used market is much smaller and more expensive for Tesla than it is for something like Lexus.

edit: Here's a quote from the LendingTree article:

SW17LS

699 is not a bad credit score. Lots of reasons why somebody would have a 699 score but could still buy a Lexus. 699 is Tier 1+ with Lexus if you get an exception which they always give.

-J-P-L-

It's not bad but also not very good. Probably means your debt ratios are too high on credit cards and such.

SW17LS

Its considered a "good" score.

Doesn't automatically mean that. You may have a short credit history, or not much of a mix of different credit types. You may have multiple installment accounts which brings your score down. And remember, its an auto enhanced score not a normal FICO score.

I see people's credit scores every day, 699 isn't a score anybody would choose not to do business with.

Johnhav430

I think I've mentioned it, my wife hasn't worked since 2014, has never had any type of installment loan and gets dinged for it (she was brought up cash only is as my father in-law and her clan). Her credit score is perfect +/- 3 points, Experian FICO 9. Does she have any ability to buy and drive a Tesla? Outside of savings? No. Again, it reminds me of that scene from American Psycho and the business cards. What's the significance of 699? 847? etc.?

edit Oh, yes, mine is lower than hers, and I have never paid a bill late in my entire life. lol

SW17LS

Credit score is just one method of looking at how risky a potential loan is. Obviously, you have to have the means to repay the loan.

So if you have an 800 score but only $5k in monthly income, you’re not getting a $4k mortgage. But if you have a 690 and $30k in monthly income, no problem.

mmarshall

There are a lot of screwed-up rules in the credit-rating business that, IMO, need to be changed. One of the silliest is the rule that, even if you have a good income and million dollars sitting around in your account, and can more than afford to pay back any reasonable loan one would take, if you take out new credit cards, or open new accounts at the bank that you didn't have before, or have people checking your credit, it drops your rating (ask me how I know). And it drops the rating even if you are just as well off (or better off) financially after these credit-requests. IMO, that is absurd....it penalizes people just because they decide they want a credit card with better terms than they had before, or a bank account that pays more interest or is more favorable their terms.

SW17LS

Seeking credit makes you more of a credit risk, that's why this happens. It makes perfect sense when you think about it, and all you have to do is limit the amount of new credit you open and who you let pull your report.

Applying for bank accounts won't pull a hard inquiry on your report either. Of course, applying for a credit card does.

The impact of having your credit checked is also very small and fades quickly.

Mikerx80

iTrader: (3)

There are various credit bureaus from Experian to Transunion. Depending on the FI, they pull from different sources and some get an average. There are numerous ways to maintain your credit score. What helps significantly is making sure you pay down your revolving balances. Making sure you pay down credit cards to zero balance every month will skyrocket your credit score. The key is to never over leverage yourself. Most people with excellent credit scores are low levered.

Your credit score dictates which tier you will land for loan terms and rates, higher the score the better the terms you will receive. Constant hard pulls will deteriorate your credit score. Obtaining credit inquiries solemnly will not have much impact on your credit score.

Getting a home loan is a complete different animal from getting your basic consumer auto loan. There are various ratios such as DTI (debt-to-income) that must be met to be a QM (qualified mortgage) loan. With heightened competition, many lenders are going back to their old ways getting active in Non QM loans. “Big Short” all over again.

gengar

I drop below 700 every so often when my utilization happens to be super high. 100+ point swings sometimes in just a month.

riredale

Biggest variable someone once told me was the ratio of how much was borrowed on my credit cards versus the credit limit. Keep that low, and never keep a balance on a credit card, and don't let a payment slip by for more than a month or so.

One thing I like to do is get two or three new credit cards every year because of the offers; one card will offer $200 if we spend $500 on it, an airline card will offer 70K miles (that's worth about $700) if we spend $2K on it within three months, that kind of thing. I keep track of airline cards because they are free only for the first year, then a $90 annual fee, so we drop the cards after 11 months.

I pulled our credit report and was amazed by the DOZENS of old (cancelled) credit cards listed, but they apparently haven't affected our score very much. Maybe the credit folks know a lot of people just get cards short-term for the up-front perks.

arentz07

+1. My wife and I racked up a bit of a balance on my credit card trying to pay for our wedding, and after paying that down my credit score has been gradually climbing since. I might actually break 800 next month for the first time! (sitting at 796 now)

gengar

Yes, this is what's referred to as utilization.

There are two negative factors that are affected by opening many new credit cards. First is that new CCs usually require hard inquiries, and recent inquiries (recent usually meaning 'within the last two years') typically make up ~10% of the credit score. So if you open a ton of credit cards every two years, this can affect your score. The second negative factor is that this will bring down average account age.

Of course, if you are opening lots of new credit cards (and not spending much on them, except to satisfy bonus offers) this could have a positive effect on utilization.