Being a first-time car buyer can be nerve wracking. Not knowing where to start or how to approach buying a car can bring added stress. If you’re a new car buyer with little to no credit, where do you begin?
Helpful Tips for First-Time Car Buyers
Here are four tips for first-time car buyers:
- Pull credit reports – Even if you’re convinced you have no credit history, it’s a good idea to pull your credit reports anyway. You may find that at one point you used credit, or find inaccurate marks on your report. Make sure all the information is correct and report any mistakes to the bureaus. You’re entitled to one free copy of your report every 12 months from each of the three credit bureaus (TransUnion, Equifax, and Experian). If you need more than one, you can pull as many as you need for a small fee.
- Budget – Using online tools, make sure you budget for your car purchase. There’s more to buying a car than the selling price – consider the monthly payment, car insurance, gas, and maintenance and see how you can balance all that with your current finances.
- Have a down payment – Because you have no credit or spotty credit, a down payment will likely be required by the lender. You’ll typically need $1,000 or 10 percent of the car’s selling price, whichever is less. If possible, consider putting down more. The more money put down, the less you’ll be paying in interest charges over the course of the loan.
- Consider a cosigner – One of the best ways to get approved for an auto loan as a first-time buyer is as a cosigner. Being a cosigner is a great way to build credit history, but the loan and title won’t be in your name. The primary borrower’s name will be on the loan, which means if you default or miss payments, they'll be responsible for making payments.
The Bottom Line
In the end, the most important thing to remember is that the car you buy should be affordable for you and reliable. But finding a dealer willing to work with you can bring even more stress when you’re a first-time buyer. This is where Auto Credit Express comes in.
We work with a nationwide network of special finance dealerships that are connected to lenders willing to help consumers dealing with little to no credit, and we want to help connect you with a local dealer. To get started, simply fill out our free and secure auto loan request form.