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Can't get approved for a loan.. suggestions?

So my tesla is ready for pick up, but I just got a call saying that I can't get approved and I would need a co signer. I am a year out of college working as a software developer making 80K living at my parents still so I have no expenses so a tesla is the perfect toy to buy, especially since I have so many ideas for apps to make!

Anyway my credit score is good, but the banks say my credit history isn't long enough. And I bought my current car for 20K cash a few years ago, which I now regret for my credit. Basically they said that the only way I could get this car is if I came up with enough cash to buy it, however that would not help my credit at all and that is one of the reasons I want to get this car. Would anyone have any suggestions what I can do? A co signer is out of the question since I make more than anyone else in my family...

Any advice would be nice! thanks!

I have I even offered to put a 50% down payment on the car. :(

If you CAN pay cash, you could use the cash to get one of those secured credit cards and put the car on that. But I think you need to consult a financial planner. I'm not sure a Tesla is the best way for someone in your position to be spending his money... I'd start with moving out of your parents and build your credit with a rental history.

Try other banks or credit unions. If your parents are in USAA or some other similar organizations, that can help. You might have to pay a higher interest rate but it should be possible. Also, you can try www.lendingtree.com where you can apply for loans at multiple banks at the same time.

Full disclosure: Based on what I know, neither I nor any of my friends/family members have any connection to Lending Tree or any of its affiliates. (Dang, is that disclosure necessary?)

Good luck.

Who did you try to get financing with?

Geek, does renting actually help your credit?

I have tried bank of america and Wellsfargo.

Prash thanks I'll give that a shot!

Does anyone know if I can't get a loan if there is anyway to get my 5k back? I guess I'll ask Tesla that question as well.

If you had not tried PenFed, they are the easiest.

Not trying to be mean but why would you go through the entire ordering and build process without having your financing secured? That would be the first thing I'd do before even putting down the 5K deposit. It's a little late now - isn't it?

Alex,

I'm really surprised you can't get a loan with 50% down. With that much down, the risk to the lender is very minimal.

Have you tried to go higher up to someone who has the power to override a computer generated approval/denial process?

Like StarrX said, try www.penfed.org or try your local credit unions as well. Some of the big banks like BOA and Wells tend to be very picky.

@alexeb112- the paperwork for the car order specifically states that the order is not contingent upon financing , and that your deposit will be kept as liquidated damages. However, they can still enforce the contract unless they agree in writing not to. So best bet is to call them! I doubt you'll get your 5k back but you can hope they won't enforce specific performance on the contract.

@carefree- he would have had to get pre approved when he put down the deposit ( like 6 months ago??), and those pre approvals aren't binding on the lender because they're only good for a specified period of time, so he can't be the only one in this situation!!

Good luck alexeb112

I think if you got your parents to co-sign that would be all you need, regardless of how much they make. The lender justs wants the loan secured. Ask your parents.

I agree with asking your parents. Lenders are looking for a good payment record first, then they look at how the loan will be paid off.

So how did your car get finished without the financing arranged? Had they initially approved it and then backed out?

@alexeb112 - While renting isn't credit, per say, your address renting/owning history definitely factors into your credit report. It shows you are responsible about monthly payment obligations.

Try Wells Fargo and search college grad loans

credit unions are easier to get loans than big name banks.

scared i will have the same situation happen to me. what is this penfed all about? any updates to your story ?

Pentagon Federal Credit Union. Requires some ass'n to the military, or a donation to a selected list of charities ($15+?). Loans to 70% of sticker, at 1.49% for perfect credit scores, higher for lower scores. Etc.

P.S. I forget whether it's 5 or 7-yr terms. Check online. Some have started and processed loans online with them in less than a day. It's getting very used to Model S, and likes the business, and much of it comes from the forums 'spreading the word'.

@GoTeslaChicago Yeah that is what I though, but so far I have only gone though the tesla reps and they said they couldn't get me a loan even with 50% down. So in the morning I will go to some banks and ask in person. I remain doubtful though...

@lov2krz when I talked to the tesla financing office they said that the co-signer had to be someone that could basically get the loan on their own, and neither of my parents would be good enough..

@cmarkortiz that would suck! I am going to go to some banks in the morning and actually talk to people, I find it hard to believe that a bank still wouldn't lend to me even when I offered to put 40k as the down payment. But that was Wells Fargo over the phone so maybe I will get a different result in person.
It looks like PenFord is a credit union that is for people affiliated with the army or something, but if you donate 15 bucks you can become part of it and get a max of 70k loan with 10% down or something like that.

Yeah, PenFed would suit you perfectly, if you can get it. And you're right: $70K, not 70%.

Try Alliant Credit Union. No matter where you live, you can become a member through a national non-profit organization by signing up for its membership (minimum donation - few dollars). If there is no derogatory information in your credit history, they should be able to do a loan for you.

Take care.

Alex,

What state are you in? I have a call out to my loan officer at Alliant to ask him whether he thinks they can finance someone in your situation. I'll report back anything I learn.

Penfed I found to be very right so I wouldn't try them. I went to logix credit union and the process too 5 minutes. I had previously been denied by penfed and logix approved me right over the phone. Try them and the rate is the same as penfed. 1.5%.

In last post I meant penfed is very tight. No right. Gotta love spell check.

So you want advice? Here's some that I suspect you really don't want to hear but what the hell . . .

First of all I think the bank is doing you a favor. (Boo, throw the bum out!!!) You're making 80K a year working as a software developer and living with your parents? Not a very healthy situation to begin with. If you were living on your own, & we have to wonder why you're not, you'd quickly realize that your 80K salary is not a hell of a lot - especially if you lust for the kind of life that a 60-90K car fits into. Despite what you've read about the car both here & elsewhere you've no idea of what it's going to cost to own it. I'm not referring to car-related stuff like insurance (sill under 25? Watch out!) or down time (it will happen). Little aggravations like - you've picked up a hot date & pick her up with the Tesla (!). Oh! she thinks, this is going to be a memorable evening! She's expecting to be impressed. So you go to a fancy-ass eating establishment with the wine steward, valet, etc. etc. And after a nice romantic meal the check arrives & the amount equals roughly what your car payment is for the month. All you had been thinking about was a simple meal followed by what we're all after. So what now? You take her to your parents place? But she's expecting a condo overlooking the Mediterranean & thinks: he still lives with his parents? Suddenly the 80K (before taxes) is starting to look like poverty wages.

OK, I'm full of it, you're still determined to get the MS. Here's what you can do: Save up the money & pay cash for it. Advantages: You don't have to deal with the bank (& you can stop in & offer the putz who declined your loan a ride in the car). You don't have to make monthly payments which will cause the final price of the car to go up ???% (oh, & what if the company tanks while you're still making the payments? We on this forum don't even want to imagine that possibility because we can all afford to take the loss - aren't we guys!) You appreciate car more & you'll treat it even better because you busted your ass saving for it. Since it's surely going to take some time (coupla years, probably more) you'll know how the company is doing. Maybe it's got a newer model available, maybe a better battery, maybe the cost has come down, maybe they're still in business! Maybe your parents have come to their senses & thrown you out of the house.

Hey Alex(?) if you play your cards right it's a long life. Maybe it'll take some time, but you might learn that if you can't get all the stuff that you lust for at the beginning, getting it a little - or even a lot - later often brings joy that you can't even imagine at this stage of the journey.

Alex, you don't say which model you ordered. If an expensive one, consider downgrading. I suspect if you go high enough up the chain, Tesla will accommodate you though in theory they don't have to. A lower loan amount might be easier to get.

Just general advice for others, you can get a pre-approval before you finalize your configuration. You have a full 4 weeks from when you get the configuration email and when you have to finalize. At this point, if you can't get financing, you can still get your $5k back.

@Alex, my advice to you is to speak to an loan officer at various banks and how much financing you can get, if at all. For example, if they say you can only get $30k or $20k, then you can find other ways to get cash (i.e. credit cards, personal loans, etc.).

I actualy had the opposite experience with my financing...I specifically went to a local credit union because I wanted to give a local business my business...But was denied (I think mostly due to the "exotic" nature of the car). All of a sudden, I was in a total panic...I applied to Bank of America and Wells Fargo, and was approved by both in minutes. Not sure that this is any help to you, but I'm just sharing it because it's so different than the other people's experiences mentioned here.

Alex! I am in the same shoes as you. So don't listen to BS advice from bottesini. Try everywhere you can and you'll get it one way or another. And bottesini stories about your date and an apartment overlooking Mediterranean Sea.... Don't listen to people like this. Live your life and enjoy it because if you don't buy this car you'll regret it in the future. God forbid something goes wrong, your parents will always cover your ass. So go ahead and try.


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