My youngest son decided he wanted to replace his Cavalier with a new Ranger. It would have been his first new vehicle on his own. He saved up and had over $4000 to put down. He went to Ford's website and looked at the Ford Motor Credit requirements. He met all of them. The catch that they don't tell you is they require at least one reported credit account. Two dealers said his down payment would get it done and both delivered the vehicle awaiting approval. The dealers said he didn't qualify so he had to take the vehicle back. Very dissappointing. The last dealer finally told him that Ford Motor Credit does not do 1st time buyers, no matter what, unless the have some reported credit. He also said that they don't want to do young buyers at all, too much risk. In this case Ford lost a customer, he now has a Jeep Liberty and at an interest rate 3 points less than he was told Ford Credit was going to charge. How many members have remained loyal to the brand of their first new car? I know I did through 30 years of Fords. After this experience I now have questions.

 

The financing game can sometimes seem a bit confusing. There are a few ways your son actually could have gotten financed through ford.

One way was to get a co-signer. If you or someone he knew with good credit co-signed for him, there wouldnt have been a problem.

Now if he wanted to get the financing on his own through ford he would have had to put a large down payment. This makes a situation where, he has more to lose than the bank does if the truck gets reposessed.

Think of it like this, lets say he bought a 2003 F-150. The trucks book value (wholesale) is somewhere near $19000. Now if he puts down close to half ($11,000), then the bank says, well if this kid decides not to pay us, all we have to do is sell the truck and we will easily get our money back ($8000). And then there would have been no problem to get him approved.

So, for a first time buyer its usually best to start off with a used car. I even think you can finance a used car through Ford motor Credit.

 

FTB deals are tough to get done- but not impossible. Sadly, a lot of it has to do with how big a stick the dealership wields with FMCC.

 

I did pretty well my first time buying with my 98 Ranger. Granted I was almost 22 when I bought it. I put a chunk down though..10.5. Got financed through FMCC, though being a first timer I forgot to read the paperwork. Got screwed. I had negotiated them down to 13995 plus tax,tag,etc... Never even caught it til last year. I was going through old financials, cleaning up and found the contract. Flipped through it and wow...actually was charged 15995 plus fees. Man I was tee'd off for a few days.

 

That first-time buyer/ matching down payment from Ford Credit IS a joke. It's so bad and so hard to decipher that we've been ordered by our dealer to not even bring it up. It says right in the program that the first-time buyer eligibility will be determined by Ford Credit, but they don't tell us what their requirements are.

 

Bronco351, I guess you missed the "He wanted to do it on his own" part of it. He already had a used car he had paid cash for, but I guess you missed that also. The drive out price was $16,000 he had $4000 down (25%). Our discussion Sunday with some other parents at church, found that we aren't the only ones who have had to suffer through the false advertising of Ford Credit. They only seem to approve 1st time buyers with outrageously high interest rates, large down payments on high dealer gross profit deals. We have decided to ask the State Attorney General to look into it.

 

I had a very interesting convesation with a local Ford F&I man yesterday. He told me that they have never been able to get a FTB financed with FMC's online qualifications. They actually use a local Credit Union when the buyer has a minimum of 25% down, 1 year on the job, $1500+@mo. Income and the insurance and payment equal no more than 1/3 of gross income. He even said the College Student Focus/Ranger program is a joke.That's why they didn't order the special package Rangers in the quantity they did last year, they still have 2 of those stripped down units left over.

 

Not that it's any help, but GMAC is no better.

 

My son ended up getting financed with First State Bank (local) @ 9.99% for 48 months. He got the financing on his own by calling banks and asking if they did FTB loans. This wasn't even his personal bank, but it is now. The lady at the bank told him that the two dealers had caused 8 inquiries to be placed on his credit report, for most people with no history this would have been disastorous to there beacon/fica score. After he had his financing in place he went for the best deal. It was strange though he went back to the dealer who had the Ranger he wanted originally and they treated him like he had the plague. So he went to see a freind who works at a Chrysler-Jeep dealer Parts Dept. and bought a Liberty. They made him a deal that was actually better than the Ranger (equity wise) and handled all the paperwork through the bank. The issue here is he is 20 years old and he wanted to do this on his own. I respected that and only gave advice when asked. He did a great job finally getting everything worked out. Now he is letting all his freinds know how the Ford Dealers and FMC treated him. He's got me looking at a Dodge Cummings as my next new truck (I buy a new one every year) through the same dealer. It would be my 1st non-Ford in 30 years.

 

All thanks to an idiot dealer and Ford Credit, neither one of which can see beyond the end of their own nose. A customer asked me yesterday if the internet would make dealers obsolete. I said no, DEALERS will make dealers obsolete!

 

Just a note for anyone who is trying to help out their children or spouse get credit if they have no credit (Not Bad Credit). Providing you have a good credit rating you could place then as an authorized purchaser a few of your credit cards. In essence you would be grafting your credit onto them. This helps. But you must do this wisely. This is completely legal and ethical and has been suggested in many consumer credit related articles. It does work. I finance homes and it quickly helps young couples with no credit obtain a better score with the help of a trusting parent. Sometimmes that's all it takes. That can make the difference between a 6% or an 8% mortgage and be a deciding factor in them getting a home or in this case a car loan.

You are entitled to a free credit report once each year from the three credit reporting agencies listed below
Trans Union 1-866-887-2673
Experian 1-888-397-3742
Exuifax 1-800-685-1111

You'd be amazed at what shows up on them. It's always worth the time to invest in so you can clean up your credit worthyness 6 months prior to financing any major purchases.

 

That credit card tatooing does work for credit reporting, but time restrains prohibited us doing that. It's kind of funny that my son has received tons of credit card offers since he graduated from HS. He has just torn them up because he feels that would be an easy way to screw up his credit.

Jeff I wish I had checked out this thread before all this crap started. I feel like you may have been the kind of help he really needed in his first purchase. I'm sure the "Road Trip" would have provided him some extra education.

 

Hey, NEXT TIME! The way things are going, I'm sure I'll be here for a very long time...

 

Gosh- timely topic. Local Chief of Police recently brought his son in to buy a new Ranger- FTB program. FMCC no help. At least someone was thinking- marched the kid over to the Chevy side, picked out a Colorado, got him approved at GMAC on their FTB program, then went back and called FMCC... Sometimes you gotta think creatively.

 

Interesting....My son and I had a talk last night he wondered which was closer NY or OR. LOL