I have a 679 Fico score and applied for financing of an ATV priced at $10,100. Both lenders used by the dealer denied me and said I had limited credit. I am 25 years old and have had steady income for the past 6 years. No periods of unemployment, No derogatory remarks or missed payments and I make over 45k a year. I have credit cards and an overall credit line of 9K with only $900 being used. The lenders said if I got a Co-Signer they would do it but what is wrong with my credit and income? I feel it is sufficient enough to cover the purchase. My debt to income is not above 20%. Why was I denied individually?

 

I don't think 679 is great and the banks are kinda jittery now. If you have a good down payment, they might be friendlier. Also, having credit cards is fine, but to the banks, that looks like a $9,000 liability. Pay off the credit card, save up $3,000 for down payment, then buy the ATV. Or, save $3,000 or so and find something used. I got my old 2001 Arctic Cat for just fixing a guy's Dodge pickup. Replaced a lifter in his hemi for $400, he was happy. 2,500 miles on my Arctic Cat with no problems, I really love it! You can have as much fun with a $1,500 -$2,500 ATV as one with all the wiz bang features and 1,000 cc's of axle snapping power.

 

I think your question should be directed at a credit counselor.....not an ATV repair forum. Check your credit reports....are you just venting

 

Yea nowadays they are looking at well above 700 for a good score, unless you got a real good downpayment then they might reconsider. The other problem is the ATV itself....considered toys not necessities, people default frequently on toys but less frequently on necessities. Lots of other considerations as well such as house payents/rent, other vehicle payments, number of people you are supporting etc. Toys are one of the harder things to get approved for unless your credit is really good or you don't have other liabilities.

 

One thing I've seen is that if you've never had a loan, the banks are more hesitant about writing the loan to someone. If you have had a couple loans and paid them off they are more likely to give you the loan. Depending on where you live $45,000 per year is not a lot of income. In CA it would be considered low. In Iowa, pretty good.

 

Have you considered joining a credit union?

 

I see its been a couple months since anyone has responded on this one but I'll add a little to it. The limited credit part is probably why they have denied you without a cosigner. If the only credit history you have so far is a credit card then you have no loan experience. If it were a car loan it might be a different story. An atv is considered a toy. Banks consider it to be a luxury item, not a necessity like an automobile. Many times people default on these type of loans as Kymco 450i said. If things get tough, people will quit making payments on a luxury item like an atv to keep from losing their home or automobile. They like to see that you have already had a significant loan for something else and had a good payment history. If that were the case, then they most likely would have approved you and your credit score would have been higher as well.

 

It's just a catch 22.. You have to have good credit to be able to get credit.. Once you have a co signer and pay a loan off,then clear sailing from then on and you can build your credit score up. I had to have a co signer for my first new car at age 19. Never had another problem on car loans,motor cycle loans,etc after that.Credit standing is good to have,but also easily abused if you're not careful.