Buying a car outright can be difficult if you don't have the cash or you have no credit history. Some people shy away from credit cards, so when it is time to take a big loan, they have no credit history. Auto financing with no credit then becomes an issue for people without a credit history or people with a bad credit score.
How Much Do You Have?
Budget and decide if you can buy a car outright immediately, in a few months or even in a year's time. If this is the case, how much can you spend? If you have a car in mind, consider asking a friend or close relative to lend you some money if they are able too. However, there are several benefits to buying a car outright, including no loan payments and no interest. Auto financing is a good alternative, though, if you do not have the cash upfront. Bad credit auto loans are possible, usually with higher interest rates. If you are set on owning your vehicle, it's generally possible to do, whether you have several thousand dollars to buy the car outright or not.
Be Realistic
Match your budget with a car. You can decide if you want a new or used vehicle. A new vehicle is, of course, a new vehicle and you don't have to worry about immediate maintenance or breakdowns. If you are fortunate enough to get a good used car with limited mileage and a resale value then you can consider buying it outright. Just be sure that it has a good resale value so that you can use it as a down payment for your new car.
Co-Signer
If you want to buy a car with no credit, consider getting someone to co-sign with you. An immediate relative or a close friend works well because you already have the trust built up. However, if you fail to pay your loan on time and it turns into a bad debt, you can potentially make a relationship with the co-signer awkward and uncomfortable. Be sure that you are committed and have the means to make payments. If this is not an option, save enough for a big down payment so a lender will not have to worry about risking a large amount on you. You can also consider waiting a bit, saving money, and getting a credit card in the meantime so that you can build a credit history.
Share28 December 2017
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