Bank loan vs. credit union loan

[jean.elmelki]

I'm looking into buying a new car and I have a question. My credit score is pretty low, but my credit report had nothing deragetory on it. The guy at the dealership said it's low because all my loans/credit cards are with credit union and I need an outside bank loan (fdic insured instead of ncuc, or something like that) to boost my credit score. He said that I can refi with a credit union after 6 months if I wanted to, but a loan with a private bank like TD in my case is what I need. Is that true?

 

[Birchtree]

Well I ain't never in my whole life ever heard anything like that - perhaps I don't know everything. Credit is credit and I would doubt that any credit reporting agency cares where the credit originated - only the discipline of repayment.

 

[RealMoneyIssues]

sounds like hogwash to me. I have use CU for a long time.

I recommend you get a credit score yourself and with your credit report in hand, figure out what is going on.

Keep an eye on your debt to income ratio too.

Myfico.com
https://www.annualcreditreport.com/cra/index.jsp
https://www.quizzle.com/

 

[konakathy]

I think it's hogwash, too.

The dealerships are usually trying to get you to use their financing and discourage you from using other sources, especially CU's. The dealership gets some kind of
commission when you finance through them.

I just bought a new car this year and they were pressing hard for me to finance through them and then suggested I refi with my CU in 6 months. I avoided the hassle and paid cash.

Look for another dealership.

 

[Sensei]

I think it's hogwash, too.

The dealerships are usually trying to get you to use their financing and discourage you from using other sources, especially CU's. The dealership gets some kind of
commission when you finance through them.

Agreed. Last time I bought a car from a dealer in the U.S., the guy tried to convince me that Toyota built "obsoletion" into its parts so that they'd break down and I'd have to buy replacements. So he wanted me to buy their expensive warranty. I really enjoyed giving him a blank stare and saying "no thanks" over and over again until his face turned bright red and a vein bulged out on his forehead.

BTW - my brother still drives the car 5 years later and has never had to replace any of those parts with "obsoletion" built into them. :toung: