There are hundreds of thousands of people in Los Angeles and California at large who have very poor credit ratings. Bad debt usually in credit cards is a massive problem in all states and cities, and L.A. is just one of those cities where people with bad credit can’t get car loans.
There are some different options in Los Angeles for buying a car no matter how your credit rating looks like to the mainstream banks. In this story we will use a story submitted to World of Financing by a frustrated borrower. This is our case study.
Carol is a model and you would think she makes a large wage – but alas, here work is sporadic at best. She applied for a car loan at three major banks and got turned down flat because her credit rating was ruined from living a common-law existence with a guy who didn’t earn a penny. He basically lived off her earnings and ran up her credit cards to the max.
Carol’s Bad Credit and Quest for Car Loan
Carol had her heart set on a brand new Mustang, and the loan she wanted was a 0% down loan. She had no idea her credit was so bad until she was checked by the Ford dealership financial department and they pushed her in the direction of a used car (that was the dealerconnection.com used car department at 5925 South Alameda Street, Los Angeles to be exact). It’s not what she really wanted for a car as she wanted a brand new Mustang convertible, but some of these used cars are in really good shape, especially with the recent downturn in the economy causing people to sell back their cars in mid lease.
So the finance department told her that her credit rating was so bad that they needed a co-signer on the loan. Unfortunately again, she didn’t know anyone who didn’t have bad debt so a co-signer was out of the question. She did the smart thing though right away and got a credit check done so that she knew exactly what her credit rating was. She found out that her FICO score was a really bad (miserable) 650 – OUCH – and that really put a damper on the situation. She was furious with her roommate who had ran reckless with her credit cards, and pretty much destroyed her credit rating – he was promptly punted out of her apartment to the street. He was a lousy friend anyway, and a terrible provider. Be careful who you bed down with friends.
When Daddy Comes to the Rescue as Co-Signer for her Loan
When the reality set it Carol knew that there was no way she was going to get a car loan unless she got a co-signer who would help her out. She broke down and called her Dad who lives in Los Angeles too. She took that humbling journey through Mission Junction, Little Tokyo, down South Broadway and onto the Santa Monica Freeway. She drove her rundown car down highway 10 to Santa Monica where her Dad works and lives. She arrived at Appian Way and Pacific Terrace, where she was greeted by her father, who owns a $160,000 BMW limited edition based on the 750Li. He founded a….and get this….a BMW repair shop called German Car Service located on Olympic Blvd. He retired in 2003, but still has his hand in the business consulting and setting up deals. He mostly just buys and sells cars as a form of semi-retirement.
So now the plot thickens right. Carol had already told her dad about her terrible credit problem, and how bad her FICO score was. He already knew why she had come to visit, but the truth was he loved her to pieces a swank restaurant on Wilshire Blvd. and never discussed the reason for her visit, her bad credit, her financial predicament, her FICO score, or her plain old broke existence – or most important…..why. No, he just asked how things were and never once brought up the fact that she had not seen him for over 7 years. He was just thrilled to see her – period.
On the way home down Olympic Blvd, he finally brought up her financial mess, and asked her how bad her credit was. Carol told him that she needed a new car for getting to work, and that there was no way she was going to get a loan with credit rating being so bad. He listened closely, not adding anything to the conversation – just smiling calmly and looking at her with fondness. She was extremely embarrassed to tell him how her new life in Los Angeles had not gone off according to plan, how she never became a star and turned to modeling. She told him how she did car shows all the time (ironic I know) and that was the niche that she had been stuck in for over 3 years. She felt sick telling her father how bad her choices had been since she left home, and never once gave any thought to how bad her financial situation was getting – “just a party girl in la-la land right Dad” (she made this reference because that was one of the insults her father threw at her in one of their many argument over the years).
But those days were over, and he didn’t care about that anymore. As he drove his ruby red, mint condition and limited edition BMW in to the underground parking lot, she noticed that there was another beamer sitting right next to her Dad’s stall. It was identical to the BMW she was sitting in, except for it being navy blue in color. When they got out the car her father pulled out a set of keys and cupped them in her hands – “it’s all yours honey….enjoy it and care for it, you can get it serviced at the shop every six months. Just tell them I sent you and get your service schedule set up”.
Carol began to cry immediately. She had tears running down her face, as she eagerly opened the doors on her brand new $160,000 dollar BMW. The inside smelled brand new, and the interior war regal to behold. Her father was smiling ear to ear, and tears were now forming in his eyes. They went upstairs to his condo where she signed the transfer papers, and got the literature for the car.
She spoke more about their lives and all they had been through since Mary had died in 1997. Carol missed her mother desperately, and her dad has never remarried. She told him all about the car dealership that wouldn’t give her the financing for any kind of car, and how he was her only chance for co-signer. She told him how her “roommate and friend with NO benefits” help put her in the poor house, and how her FICO score was in the mid 600 area. He went into detail on how credit ratings work, and what FICO stood for, and what not to do – like pay off a car loan with credit cards.
In the morning Carol, had breakfast with father for the first time in years, and then drove back to Los Angeles in her brand new car. A very happy ending to what started off as desperate situation for young Carol. She never let herself get in that kind of debt again, restructured all her debt into one consolidated loan, and went back to school to finish a degree in commerce.
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