The idea of adding more debt on top of the student debt you already have must seem like a bit of a crazy idea. But having a vehicle can be a valuable resource for many students. Students need transportation to classes, jobs, internships and any other extra-curricular activities. While not having any credit history may make it seem like it will be impossible to get a decent car loan, it's actually easier than you might think. Here's what you should do if you're a student looking into a car loan
Having a strong credit score is the best way to get any loan, and maintaining a high score is pretty easy. Just pay your bills on time, have it for a long time, and don't go overboard on how much credit you need.
Don't Take On Too Much Car
Everyone wants a nice car. But a college student really doesn't need a $50,000 luxury vehicle as their very first car. Understand that this loan will be with you for a long time and you don't want to be handcuffed by an expensive loan, or a loan that will take a long time to pay off. Choose a car that makes sense for you and your needs.
Make A Down Payment
The more money you put down at the beginning of a loan, the less money you're going to need to pay at the end of the loan. This will also make your monthly payments a bit cheaper which will leave a little more cash in your pockets.
Get A Good Cosigner
A cosigner is like a loan safety net. If for whatever you can't pay off your loan, the responsibility falls on the cosigner. Whoever is looking at loaning you the money for the car will also be looking at your cosigner, so make sure you get someone that has good credit as it will help you secure the loan.
Stay Up To Date On Payments
This goes hand-in-hand with the rest of the "Building Credit" strategy, but it's extremely important. Missing payments and defaulting on credit is a sure way to plummet your credit score, and you really don't want that to happen. Pay your bills on time, and you'll be fine.
Just because you're a student with little or no credit, doesn't mean it's impossible to get a car loan. That doesn't necessarily mean you're going to get stuck with a massive interest rate either! We have Credit Specialists who can talk to you about what your options are when it comes to getting a car loan. Contact us today to get started on your new car adventure!