Are you planning to buy a car for yourself? Is it the first time that you are thinking of buying a car? Are you confused as where to look for financing? Are you finding it difficult because you have no credit scores? Then first time buyer auto loan is the answer to all your questions.
Generally college students and newly graduates fall in the category of first time buyers. It is difficult for a college student to get the desired auto loan because they have no credit history. Yet each and every one of them desires to own a car of their choice. However, they find it difficult to get the finance to realize their dreams.
Moreover, since they are studying they might not have a high income or even a stable source of income. But they need not be disappointed. They can apply for the first time auto loan. These are not very difficult to get. Some of the initiatives you can take to help yourself are below:
Lenders: Start looking for lenders who are willing to provide you with a loan. It can be banks, financial institutions, credit unions, online lenders and even auto manufacturers and dealers. Most lenders are ready to offer a first time buyer auto loan.
Interest rates: Since the applicants have no credit scores to their aid, it is difficult to ascertain repaying capacity. Hence, such applicants may be considered risky in comparison to others. To protect themselves from the risk, the lenders may hike up the rates of interest. So the applicant should be willing to pay more.
Offers: It is best to look for the information in advertisements, offers, promotional offers, etc. Sometimes the manufacturers come up with special offers for first time buyers. If you apply to such loan and it gets approved, you may get the advantage of offers like free car insurance among others. Many times the interest rates offered in such offers are at discounted rates making it attractive to apply.
Down payment: If you have saved some money and it is not utilized, use it to pay down payment for the car. The higher you pay in down payment, the lower the rates of interests are. The lenders consider that if you are paying higher money down, then you will be eager to pay your monthly payments in time too.
Security: When the applicant can provide with additional security to back up their loan in the form of collateral, the lenders are more than willing to talk. They will also lower the rates of interests. In case you do not have collateral to put as security, having a co-signer with stable source of income will also do the trick. Another way will be if you are working alongside with your studies, they you can get a proof of income and a reference from your employer to support your auto loan application.
Nevertheless, sharpen your negotiation skills. Look forward to bargain to bring down the rate of interest for your application.