Hey guys,

I'll try to keep this short but I want to give the entire context of the story; ultimately I understand if I'm denied, there's nothing I can really do but you guys are much more experienced than I am so I figured it's worth a shot to talk about it.

I'm a self-employed graphic designer making about 12-15k a month, but in November I took a job that pays 12k a month (full-time but I still work from home, a very lenient and lax work environment but I do my job well). Since then I've been making around 25k a month (salary + side-income). My contract is for three years and it can go past that depending on if they want to keep me. I am the head of design of a company.

In November, I walked into my local Porsche dealer with my BMW M4 looking to trade it in for a 992. I test drove a black C2S, they ran my credit, asked for bank statements + the contract of the company that I work for and they said that they'll try to get an approval with $6k down, 12k miles/yr 48 months. Negative equity on my M4 tacked on an extra -12k (unbelievable, I know). But I figured what better way to celebrate a huge pinnacle and turning point in my career than to make a terrible financial mistake? He told me that because of my negative equity, Porsche want 20k down. I said that I can have that in a few months, I just paid 15k to move into my new apartment + furniture so $ would be a bit tight for about a month while I recover. He said no problem, let's build you a car and in March it'll arrive which will give you time to get your things sorted. He said I was approved on C-Tier but I got my credit score from a 690 to a 720 (720 is what I'm sitting at now). As far as credit length goes, I'm 26, I didn't know what a credit score was until I was 23 years old (my parents didn't prepare me for the real world, in a sense, I was just a bot taking a cookie cutter path at UCLA not knowing what I wanted to do with my life). So my history is short but I've paid 1,320/month for my M4 for 26 months now, never had a missed payment, all credit cards paid off on time and 10% utilization. My girlfriend cosigned for my M4 which is why I was even able to get that car. I built my 992, came out to 143k, and they ordered it. I also told them I did a lot of research and decided that financing instead of leasing is what I want to go with, especially after seeing how similar the numbers are. My girlfriend also told me that even though she knew I wanted to finance this car all by myself, she'd be there to help me get the best APR if I needed her to cosign. I was really adamant about doing this myself but I guess things took a turn south so I agreed to her help once more to help me get my next dream car. Haha.

NOW, here's the problem. Circling back to "I had no clue what a credit score even was"; I was looking at other 992's and found a similar build to what I ordered and I called that dealership just to talk about it. I didn't know what a "hard pull" or "inquiry" is on your credit score until last week when I researched it. I have about 40 on my credit score; it's embarrassing but I didn't know what it was so I feel a bit like an idiot. Anyway, this other dealer said "yeah we can go over some numbers just fill out a credit app" I did and I got insta-denied. Also, just to clarify, I talked to my original SA about it and asked if it's possible to have them bring that car there to his location so he can sell it to me and he said that's not how it works. Even if I did get accepted for financing I would not have taken the car because I wanted to give this salesman my business. Basically I'm an idiot and jumped the gun on a hard pull on my credit for no reason, just like I have always done because I didn't understand the implications of it. By the way, I looked into this second car a week or two after I placed my 5k deposit for my initial build. It was a while ago.

Today, my SA told me that Porsche denied my application for 20k down on the car I ordered which has just arrived. The main reason being that because I filled out that stupid application with that other Porsche dealer and got denied, they're insta-denying me again. What is also interesting to me is that my girlfriend who has a great credit score (820+), long credit history, comes from a very well-off family cosigned for the 992 and we still got denied. My SA said he's going to try everything he can to get me the car for 20k down tomorrow, but right now he can't do anything because the bank is closed. He said I might have to fork up 30k down, I wasn't prepared for that because I spent the last few months putting money into my credit cards to get it down to 10% utilization in anticipation of the car arriving. So it's going to take me another few weeks of saving up to get that $ down. We also had an agreement of 20k down. Is it normal for Porsche to deny you just because you were denied once before? Is there anything I can do in this situation if I want to finance this car? I'm pretty heartbroken; I dreamed about this day for four months for it to end like this.. The car is even up on their website now, too. Makes me want to cry! Haha.

If you read this far down, thank you so much! Any insight, tips, etc. would be much appreciated. Are there other lenders I should speak with? Is there a chance this car will be sold right under my nose? So many questions, just really distraught right now.

 

Also, I know my rant won't really do much for me. I can't get an approval from whining on an online forum- just needed a place to vent. I have so much anxiety from it too that I can't sleep and I'm just counting down the minutes until tomorrow where they'll most likely give me the nail in the coffin that I didn't get the second approval after trying to negotiate with PFS. Thanks for reading

 

Do you have a 401k and an IRA?

 

You should seriously consider building a balance to fund your car and buy it in a couple of years. As much emotionally invested you are, Porsche is invested in their finance algorithms. It’s only a car. You can reorder your build anytime. Alternatively, wait a year and there will be plenty of CPO 992’s on the market.

 

+1...and look at my forum name!

 

Amazing that anyone can make that kind of coin and not have a decent credit score....

 

You are making a great living at a young age, a new apartment, you’ve got an M4, sounds like a very good relationship with your girlfriend ... life is going your way which is awesome. I get you want an 992 ... who doesn’t but $20k down or even $30k down means you’ll be financing the sh*t out of this car and paying a lot of interest ... You’ll be upside down the minute you leave the showroom (which you already are experiencing with the bmw) as well as many years afterwards. A $100k plus loan is huge especially for a car.

My advice would be to pay off that M4 as quick as possible and then start saving for your Porsche ... the only problem with that theory is in a few years you might be thinking more about a wedding, a house and possibly kids and you’re last priority might be a 992 ...

 

Is your $5000 deposit now refundable since the terms of your agreement changed? I put down a 5k deposit on my 992 build that was not refundable if I backed out (I think at least since I am never going to back out I did not care). I think you should be able to get your deposit back in this situation and then I would agree that this purchase is a terrible decision at this time point. A car purchase of this magnitude should be "slush fund" money, not finances you need to survive and for the basics. I would argue you should also have zero CC debt prior to considering this. It sounds like you already made one bad financial purchase and I would think you are going to end up with terrible interest rates, etc. Owing this much on a car loan is not going to help your credit score. Sorry to be a kill joy, but I had a non powering steering Saturn at 26 saving money to pay off all debt and it helped establish my financial footing. Good luck

 

Working under the assumption that your $12k/mo is W-2 income, your after tax income is probably somewhere around $90k/year or about $7,500/mo. So, a hypothetical loan payment for your 992 is probably north of 30% your net W2 income. That doesn't leave much room for other debts, student loans, credit cards, etc. Beyond debts, if you spent $15k moving into your apartment, you're probably spending a healthy chunk per month on that too. Finger in the wind here, your debt to income ratio isn't working for the borrowing necessary to make this happen.

What about side hustle income? Well, it takes about 3-5 years of history for independent consulting income to be taken seriously by lending institutions. Even then, 1099 income just isn't viewed by banks in the same way as a W2 -- it's almost never recognized anywhere near 100%. Why? 1099 income has to be collected, clients stiff vendors all of the time, and the customer/vendor relationship is fundamentally different than that of a W2. Plus, if your side hustle is throwing off that level of dollars, you're on the hook for substantial quarterly tax payments.

Your girlfriend may have a great credit score, but if her income couldn't cover the 911, her co-signing doesn't necessarily solve your problem. While you mentioned everything else about her family, etc, mention of her income was conspicuously absent. It doesn't matter how wealthy your parents are when you enter adulthood, even a trust fund has to throw off enough cash to cover the nut.

With that, I suspect that you're being denied, because the debt to income doesn't work here. Strong clue? the SA suggested a higher down payment, likely in attempt to get your monthly payment just under the wire to be able to buy this car. The interest rate that will come with that deal will suck, just a heads up.

40 hard credit pulls? That's the kind of detail where I feel like something is missing from the story. It's your business to disclose and what not to disclose, but if you've got 40 hard pulls and are not the victim of fraud, you've been looking at making a lot of big ticket purchases. That's also a lot underwater for that BMW after 3 years -- I suspect that likely wasn't a 60 month loan.

I'm doing my best not to climb on my fatherly soap box here, but having a kid approximately your age, I am going to say it -- a brand new 911 can wait.

 

$25k/month and 40 pulls with a bad score? Something is missing here.

No offense, you are young. Not to get into the whole wealth discussion - but do you know your net worth? Do you have savings? Retirement funded (which probably took a bath like most of us this past week)? Do you have plans to buy a house? Get married? Is your income secure or are you just having a recent windfall?

I think this is fate telling you that it's too soon.

 

First of all I’d want to say you seem like a cool young guy, and have good stuff going on in life, you have a cool job you’re obviously great at, sounds like a great girl, and I respect that you’re out of your mind insane about great cars.

But I do think a little more focus on your financial health will go a long way... perhaps this is a positive development.

As your career continues to progress and you’ve gotten your retirement saving plan on to a nice start, there will be a right time to walk in to the Porsche dealer and purchase a new 911, and it’ll be an incredible milestone/reward in your life.

In the meantime, there’s a lot of ways to stoke your automotive passions to the max for less coin, maybe even a lot less than you’re spending on the m4...

Btw, I remember vividly, in 2006 or so, when I was making about $125k, and had just gotten my first apartment by myself (nyc area) going to the Porsche dealer with my boss to help him pick out a 911 (he wanted a Range Rover but I changed his mind)... I sat in the boxster in the showroom trying to figure out if I could make the numbers work, but couldn’t. This made it that more satisfying when 11 or 12 years later I was able to afford a new 911.

That all having been said, perhaps financial security isn’t for everyone, in which case maybe you can get this sorted out, share the build sheet, and post pics of the three of you!

 

yeah.. 40 pulls?? Someone needs to learn about how FICO works... I was borderline in panic having them pull my credit when I got my car so as not to ding my nearly perfect credit score.

 

Talk to Antonio Saba at woodside credit. I am a trial lawyer. Most of my practice consists of plaintiff high stakes class actions causing my income to fluctuate drastically from month to month and year to year. Antonio figured it out.

 

I'm betting no

 

40 pulls? Wow. $25k a month and it would appear you're still living above your means if you're needing to extend your credit. I too was uneducated about credit scores and how they were positively and negatively affected until just recently (last few years) myself, so there's no shame in that, however, living at or above your means isn't the answer. I think you should wait until you can either pay for it all in cash or most of it. Taking out a large loan on a depreciating asset isn't going to help matters. I can't even imagine what the interest rates are for your credit score.

If you're still hell bent on getting the car, the dealership's business manager (F&I) can call Porsche's financial institution (I don't know what bank they use) and talk directly with a senior underwriter and more than likely get you approved. You might not like the terms, but they can more than likely make it happen. You probably got auto-declined and it's just going to take a phone call to work through it.

Let's just say out the door with your negative equity and taxes and fees you're at $170k. Bank is willing to finance 90% LTV on $143k (ACV). That comes out to the bank loaning $129k. You still need to drop $41k to get to the table.

Wait bro......