10
Jul
Can I Buy A New Car With My Credit???
I’m turning 22, and my credit history is a little over 2 years…
I have like 4 credit cards…and macy, victoria secret, best buy, banana republic credit cards…so you can say i have around 8 credit cards…..my higest credit limit is around $2,000, so it’s not that much….I only used my credit for my t-mobile account and thats it….
I never purchased a vehicle before…..
I’m planning to buy a brand new car…around $35,000-$40,000…
downpay around $6,000-$10,000….
would there be a problem when I try to get a car loan???
I want my monthly payment to be not more then $600+
If your HC (high credit ) score is 2,000 you should be able to get a 10k car. If you add 10,000 as a down payment you should be able to get a 35-40k car. Any Bank should do it with $10k down, See if you have little, bad, or no credit you are a high risk customer. If you are trying to finance a car that’s worth 40k and you’re financing 40k and you are a high risk the bank will not approve you. But if you are financing 30k on a 40k vehicle the bank is in a position where they would probably make money with the equity( value over the amount financed) if they had to repo your vehicle so I’d say you should be good to go. You may want to get together your last check stub, proof of residency ( a phone bill , utility, etc,) and 5 complete references. Expect for your payment to go over the amount a little. You will have a higher interest rate for you first vehicle. But don’t worry if you can handle the payment for a year you should be able to refinance and get a better intrest rate and lower payment.
July 10th, 2009 at 2:39 amYou’ll be fine. Try the Ford Motor Co.’s red carpet lease. It’s a good way to build “car credit” and they’re pretty lax about credit history.
July 10th, 2009 at 2:39 amUnless you have an income of over $100,000 per year, it would be an extremely unwise to get a car that expensive with a payment that high.
July 10th, 2009 at 2:39 amGetting a car loan is based entirely on your FICO credit score. To get a good loan, you need to have good credit. If you don’t have good credit, then expect to pay through the nose.
July 10th, 2009 at 2:39 amIf you have between 6-10K saved up, I would be asking myself a few things:
- Do I have any credit cards to pay off with this money first?
- Have I maxed out my 401(K) and IRA contributions for the year?
Finally - Check out Suze Orman’s “Money for the Young, The Fabulous and the Broke” - buying a house is a MUCH better idea than getting a car…. stick with a Honda Accord and pocket the rest!
Check out your credit score. Then join a credit union and put some money in your share account. Then ask for a loan for the car amount. Most credit unions are cheaper than banks, and much cheaper than the dealership’s loan companies.
July 10th, 2009 at 2:39 amYou probably need a cosigner. I have not made any major debt purchases either and I had to have a cosigner to rent an apartment.
July 10th, 2009 at 2:39 amIt is not impossible for you to get approved with all that money down. But,if you have $6,000 to $10,000, it is a total waste of money to get a $35000+ car. At any point in time that you lose your job or your income, then you are stuck with those payments. Did you factor insurance?When you cant make those payments, then your credit goes way down! Downgrade your car!Listen to Camry, he is on point. There are better things to do with that cash then get a flashy car….
July 10th, 2009 at 2:39 amIt will depend on what kind of job you have now, how long you have worked there and how much you make from the job, how many other bills you have such as rent ect…..
July 10th, 2009 at 2:39 amBut if you pay 6 - 10 K as a down payment you should have no problems.
I got a loan for 32K when I was 23 and I only paid $2000 down and made $10 a hour.
To get payment of $600 or less you will need to get a loan of about 28K or less at curent intrest rates.
I would recomend before going car shoping go to your bank and get a pre aproved loan then you will Know how much you can get and the rates can be better than what the dealer will give you.
buying new cars is a bad place to put money… they lose value fast (like $100 a week) or 60% of value in 4 years….. unless you want to be b.r.o.k.e, i’d rethink this move.
July 10th, 2009 at 2:39 amcheck the link below.
they will also look at your employment and monthly income. with a down payment like that and your fico score you should have no problem. you will need full coverage auto insurance.
July 10th, 2009 at 2:39 amthe more places that look at your credit report your fico score drops one point for each place that checks your crdit report