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Buying A Car Question?

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Buying A Car Question?

Postby Mordecai » Fri Oct 06, 2017 1:49 pm

Hi I was looking to buy a car sometime in april/may and I was wondering if having a used credit card would hurt me. I have two but one is paid off and the other i have used 800 on the other out of 2000. I have been paying more than minimum payments on it every month and will continue to pay more than minimum till then, so i should have under 700 due by then. My credit score is around 730 (might be higher by then too) and im 20. Also I have money for down payment but lets assume I'd be giving 0 down. It will be a used car!

So my question is will any of that keep me from getting a loan for the car? and would i be able to get a decent interest rate if I do?
Mordecai
 
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Joined: Sun Jan 05, 2014 1:10 am

Buying A Car Question?

Postby Kipp » Sun Oct 08, 2017 5:21 am

My general policy is avoiding loans and credit except in buying a house, emergency medical or other emergencies, or education loans for school. Credit gets you buying ahead of what you can afford and is an interest rate trap. People "need" and what they mean is "want and impatient". Almost every car loan requires that you have full insurance coverage including collision and for some lower priced cars, the collision insurance is more than the interest on loans.

For financing, you generally do worse financing at a dealer than at a credit union or bank. Dealer financing will be a combination of a high rate and inflated car price. Check with your bank or credit union about auto loan terms and rates before you car shop. Loan approval is based on loan to value of the car and your regular earnings to debt and expense ratios. "Credit score" is just another trp to get you to borrow more money as they only lend to people that can pay them back, or the interest rate is through the roof.

In buying a used car, always get it checked out by a mechanic and assure the title is clean. It is better with a warranty to allow you to check it. I prefer lower mileage used cars especially if still under factory warranty. Maintenance history is a plus. Research car models at US News and MSN autos: http://home.autos.msn.com/ http://usnews.rankingsandreviews.com/car...

And, check its value at Edmunds,com http://www.edmunds.com/appraisal/

Check with an insurance agent about your cost of insurance before you buy the car.

A car is a major expense and people do not typically look carefully.

Auto loan rates from banks and credit unions vary a lot now, with best rates under 3% a year. Financing at a dealer can be 12 to 18%.

http://www.bankrate.com/calculators/auto/auto-loan-calculator.aspx

A $10,000 car loan at 3.5% for 4 years is $223.56 per month.

$731 is interest.

Check the loan terms for any pre-payment penalties.

In most cases, you should pay off a credit card before taking a car loan because credit cards are a high interest rate and car loans can be at a decent rate. If you have issues paying down $800 quickly, you probably have trouble getting a good rate on a car loan.


Look at your income and expenses and try to figure out where the money is going.

Most banks will not finance old low priced cars, and you end up with the used car dealer high price and high finance cost.


Again repeating from very many years experience, pay off that freakin' credit card ASAP and begin trying to save money from your earnings. If you can afford car payments, you can afford to buy a car for cash by getting a cheaper car until you can afford a nice one. Life is not about building up a credit score unless interested in buying a house. When you buy a used car fully financed, you immediately are behind in its value to the amount you owe on it. A cheap car bought for cash can avoid collision insurance and only pay the required liability insurance.
Guidance is a car less than 7 times the cost of collision insurance per year is not worth having the insurance since minor accidents get deductibles anyway. ANy loan will require collision insurance on the car.
Kipp
 
Posts: 58
Joined: Sat Jan 18, 2014 3:17 pm

Buying A Car Question?

Postby Bartolome » Thu Oct 12, 2017 10:47 am

Car insurance http://buycheapcarinsurancequotes2016.com/
Bartolome
 
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Joined: Sat Jan 18, 2014 10:05 pm


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