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New motorcycle financing with not so great credit

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ajaxguy said:
I own a home.. a van thats brand new and paid off , .
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By "own a home" do you mean you "own" it or are you carrying a mortgage and have little to no equity in said home?

'Cause really... if you have any equity at all the banks are usually bending over backwards to give you a line of credit against it.
 
the house is worth 300k more then I owe..with that said the bank still says no...federally regulated so guidelines are tight and numbers based.

Hack said:
By "own a home" do you mean you "own" it or are you carrying a mortgage and have little to no equity in said home?

'Cause really... if you have any equity at all the banks are usually bending over backwards to give you a line of credit against it.
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I think your best bet is to seek financing from the dealer you wish to purchase from. You should however be aware that a loan quoted at its annual periodic rate (APR) is not the effective annual rate of interest you will pay. APR rates do not factor in compounding. I am an accountant and there are many loan products available to consumers.

** edit: youve spoken with td and they wont offer you anything? no home equity line of credit?
 
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More information would be needed to help you though such as age, income, down payment you're willing to put, price of the bike and your current monthly expenses (rent, phone, etc)


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Also you must keep in mind when financing a vehicle you must have full comprehensive insurance on the vehicle so if you've received quotes make sure they are for full coverage but im sure youre aware of this


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clyder said:
If someone has a bad credit, how does a loan help build the credit up? And if there's such thing, why does the bank doesnt do it and instead gives a reason usually starting as follow:"Unfortunately, at this moment [...]"

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Its making the scheduled payments on time that helps to build credit again. Not just ones ability to receive a loan.
 
ajaxguy said:
the house is worth 300k more then I owe..with that said the bank still says no...federally regulated so guidelines are tight and numbers based.
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Sounds wonky... You have $300 in equity and you can't get a measly loan for a toy?
Maybe change banks...
 
If the house is worth 1.2 million then guidelines may well keep him from borrowing/the bank from lending above 75%.

Glad I rent....
 
Hack said:
Sounds wonky... You have $300 in equity and you can't get a measly loan for a toy?
Maybe change banks...
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If the person is already leveraged to the hilt (huge mortgage) even with a house that's worth more than someone paid for it (ie, if owner has only paid off 5% of the principal but the property has appreciated it still only equals 5% equity as far as the bank is concerned even though the owner may feel different), coupled with a bad credit history, a bank probably won't even consider it.

High risk lender is your only option, and I know you didn't want to be preached to about that whole situation...so I won't. But just sayin, it's gonna cost you.
 
mistersouthpaw said:
More information would be needed to help you though such as age, income, down payment you're willing to put, price of the bike and your current monthly expenses (rent, phone, etc)


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Interesting, im assuming your referring to debt/income ratio? Didnt know it included your phone, i thought it was just debt that it included(mortgage, student loans, car payments), not regular good ol fashion bills
 
Hack said:
Sounds wonky... You have $300 in equity and you can't get a measly loan for a toy?
Maybe change banks...
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bank doesn't really care about how much your house appreciated after you bought it, what they care about it how much of your own money you have in it compared to the purchase price.
if you bought a $500k house last year with a 5% downpayment, and today its worth $800K the bank wont be eager to loan you $$ against that $300k.
its hard to get $$ against your house when you only own 5% of it.
 
bigpoppa said:
Interesting, im assuming your referring to debt/income ratio? Didnt know it included your phone, i thought it was just debt that it included(mortgage, student loans, car payments), not regular good ol fashion bills
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big poppa makes $20k a month ......looks good on paper, right? but bigpoppa has $19500 a month in fixed expenses (good ol fashin bills included), so therefore bigpoppa cant afford a $1000 monthly payment for his baby momas new Bently

disclaimer - bigpoppa is a fictional character in this dramatization
 
OP - if you have questionable credit, put a large down payment, that will usually get you a much better rate
 
bigpoppa said:
Interesting, im assuming your referring to debt/income ratio? Didnt know it included your phone, i thought it was just debt that it included(mortgage, student loans, car payments), not regular good ol fashion bills
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You're correct, when calculating a persons total debt service ratio or gross debt service ratio your phone bills etc aren't included.. However, in higher risk scenarios it is not unheard of for lenders to ask for more/as much information to available to help assess risk
 
mbroyda said:
big poppa makes $20k a month ......looks good on paper, right? but bigpoppa has $19500 a month in fixed expenses (good ol fashin bills included), so therefore bigpoppa cant afford a $1000 monthly payment for his baby momas new Bently

disclaimer - bigpoppa is a fictional character in this dramatization
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thanks for the realistic fictitious example, lol
 
mistersouthpaw said:
You're correct, when calculating a persons total debt service ratio or gross debt service ratio your phone bills etc aren't included.. However, in higher risk scenarios it is not unheard of for lenders to ask for more/as much information to available to help assess risk
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ahh gotcha

I should have been an accountant
 
ajaxguy said:
the house is worth 300k more then I owe..with that said the bank still says no...federally regulated so guidelines are tight and numbers based.
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You have other issues. If you can't get a secured line or loan and you have that much equity in your home there is a definite problem. It means your TDSR is maxed out so you can't make the minimum payments on all your existing credit products so they won't extend further credit to you. This has nothing to do with being federally regulated.
 
Wrong .. all cc's are at balance 0

strictlye said:
You have other issues. If you can't get a secured line or loan and you have that much equity in your home there is a definite problem. It means your TDSR is maxed out so you can't make the minimum payments on all your existing credit products so they won't extend further credit to you. This has nothing to do with being federally regulated.
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ajaxguy said:
Wrong .. all cc's are at balance 0
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Trust me, I'm not wrong. I work in lending. Just because your balances are 0, it doesn't mean the credit limits are not used for TDSR calculations. If you go out tomorrow and max out your cards and other debts, your salary wouldn't be able to cover the minimum payments. That's what the TDSR calculation determines. Generally you TDSR around 40-60% would get approved for unsecured credit applications and they may considered an even higher ratio if the credit was secured.

So, if they are turning you down for secured debt....its for a good reason.
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